Third reading opposed and deferred until Thursday 29 October (Standing Order No. 20).

Nottingham City Council Bill  (By Order)

Third reading opposed and deferred until Thursday 29 October (Standing Order No. 20).

Motion made,
	That so much of the Lords Message [12 October] as relates to the City of Westminster Bill [ Lords] be now considered. —(The First Deputy Chairman of Ways and Means.)
	Hon. Members: Object.
	 T o be considered on Thursday 29 October

The Minister of State was asked—

Derek Twigg: May I urge my hon. Friend to make a decision as soon as possible after the inspector's report has been received? I remind him of the project's importance for Cheshire and Merseyside, as it will ease congestion, improve public transport and create more than 4,000 jobs. It will also create hundreds of much needed construction jobs during its construction phase.

Sadiq Khan: We have asked High Speed 1 to consider the potential development of a high-speed line beyond the west midlands, in particular the potential for the new line to extend to the conurbations of Greater Manchester, Yorkshire, the north-east and Scotland.
	It is expected that high-speed rail services to Yorkshire would result in a measurable impact on economic benefits. Greengauge 21, for example, suggests that a high-speed network would create some £6 billion of economic benefit to the region. The Government look forward to receiving High Speed 2's report on high-speed rail at the end of the year.

Sadiq Khan: My hon. Friend makes an extremely important point about the vision we have for high-speed rail. One of the things we deliberately asked High Speed 2 to look into was the benefits of extending the high-speed link to Manchester, Yorkshire, the north-east and Scotland. It is important that, when HS2 reports this year, we consider the report and come back with proposals next year. The alternative is short-term gimmickry to get a standing ovation at party conference.

Paul Clark: The percentage of road deaths involving collisions with heavy goods vehicles has averaged 14 per cent. over the past five years—an HGV being a goods vehicle with a gross vehicle weight exceeding 3.5 tonnes.

Paul Clark: We undertook to look at the impact, which was in the impact assessment that was set out and published, and we found that the actual cost would be between £186 and £388 per vehicle. That would mean a cost to the industry annually of some £16 million to £17 million. We had to assess whether, in the current economic situation, it would be right to impose that cost on the industry, and we decided at this stage not to gold-plate the requirements, which will need to come into force by July 2011. Of course, that does not stop companies fitting the markings themselves. In addition, we will continue to work with HGV drivers through SAFED—the Safe and Fuel Efficient Driving programme —and the Safer Driving and the Driving for Work programmes, for example, on this and other health and safety issues.

Paul Clark: For the record, may I make sure that the House is aware of the statistics? In fact, the number of reported accidents involving fatal casualties and side and rear collisions with heavy goods vehicles has fallen. In 2006, there were 183; the number fell to 176 in 2007; and it fell to 148—an almost 16 per cent. reduction—in 2008. Indeed, the number of accidents involving HGVs has fallen further. The steps that we are taking in respect of all HGVs, including foreign-registered vehicles, include an additional £24 million for the Vehicle and Operator Service Agency to undertake further checks on international lorries to ensure that they are roadworthy.

Sadiq Khan: No. Local authorities already have almost complete discretion to invest in transport as they see fit. They are obliged to seek approval only when they are bidding for additional funds from the Department—for example, for major schemes of more than £5 million.

Sadiq Khan: I think that the right hon. Gentleman made a similar allegation last year about the DFT interfering with what Somerset county council wanted to do, and he was wrong then, too. There are a number of ways in which one can obtain funding for transport projects. First, there is the £1.3 billion of capital funding, which has no strings attached whereby we could stop local authorities from doing what they want. Secondly, there is the revenue support grant: again there is no ring-fencing, and no project is subject to criteria. Thirdly, there are local transport plans. The right hon. Gentleman would expect us to be responsible to the taxpayer for contributions of more than £5 million. This is not about box-ticking; it is about ensuring that taxpayers' money is sent out properly and we get value for money. I am sure that he would welcome that approach.

Stephen Hammond: As my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) pointed out, it is to this Government's continuing shame that they are killing off so many innovative local transport schemes by national diktat. When will they do what they have done in so many areas of transport, not least in relation to the question asked by my hon. Friend the Member for Chipping Barnet (Mrs. Villiers)—drop their policy, follow our policies, and allow local authorities to make truly local decisions?

Sadiq Khan: One of the problems in doing what the hon. Gentleman claims to want to do is that his party in Westminster disagrees fundamentally with the Mayor of London on so many issues, whether it be Crossrail, an estuary airport or speed cameras. On funding, he should be aware—if he is not, I am again happy to undertake to write to him to educate him—that any major funding scheme below £5 million needs no approval from the Department for Transport. It is right and proper that we have a duty to taxpayers to ensure that money is spent properly, but there is a light-touch approach. When a major project is submitted to the Department, we work with those involved to ensure value for money and deliverability. I do not apologise for ensuring that every penny of taxpayers' money is spent properly.

Paul Clark: The hon. Gentleman has obviously taken his line from his Front-Bench colleague the hon. Member for Chipping Barnet (Mrs. Villiers), in terms of the idea that there is only one part to the Government's road safety strategy. It is blatantly clear that that is not so. Our strategy is centred on education, enforcement and engineering. Let me point out that last year, excessive speed remained a contributory factor in 26 per cent. of all deaths on our roads. Although we have had a 14 per cent. reduction overall, which is part of our strategy, excessive speed had an effect in 26 per cent. of cases, involving 600 individuals. I make no apology whatsoever for giving local partnerships the choice in taking forward measures that will help to save lives, which all the evidence indicates happens with speed cameras as part and parcel of the approach, or one tool in the armoury.
	Let me add that the Mayor of London—

Paul Clark: May I first put on the record my recognition of the dogged determination that my hon. Friend has shown in campaigning on this issue? I thank her for arranging with me a meeting with her constituents, including the father and fiancée of her constituent who was killed as a result of this problem. I can guarantee that we will continue to work with the charity sector, the medical profession and occupational health to raise awareness. We will review the new Australian research to which my hon. Friend refers when the full evidence is available, and we are taking steps to reissue guidance to general practitioners on the medical form D4.

Paul Clark: The overall policy is to ensure that we have testing facilities that are closer and more responsive to the customer base. Indeed, as my substantive answer suggested, some 90 per cent. of all operators have fewer than six vehicles. That represents the vast majority of VOSA customers, and we are keen to ensure that they are not penalised. There is a £6 premium on designated third-party premises at this stage. We are reviewing that and would expect to see it removed within the next two years.

Anne McIntosh: Are the Government minded to reconsider the length of the franchise offered, particularly for the east coast main line? Does the Minister share my concern about the debt that the company that holds the franchise—the second company to have failed when holding it—has run up with the banks, which of course is now being serviced by the taxpayer? This is a particularly difficult time, so what is he going to do about that franchise?

Sadiq Khan: The hon. Lady raises an excellent point. We keep our options open on the form and length of rail franchises. She is right to imply that a longer franchise might help to support more investment and provide greater stability, but she will be aware that when the directly operated— [ Interruption. ] I am sorry, Mr. Speaker, but there is a lot of chuntering from Opposition Front Benchers. Clearly— [ Interruption. ]

Sadiq Khan: My noble Friend the Secretary of State looks into some of the issues that the hon. Gentleman has raised, including rail usage—who is using the railways—and whether there are advantages in how a franchise is run. One advantage of retendering is that we can take on board passengers' concerns. This is not directly relevant to him, but we recently refranchised South Central and asked Passenger Focus to ask users what they would like to see in the next franchise. I am happy to arrange for the hon. Gentleman to meet officials to discuss what can happen in the next phase in relation to his constituency and his community.

Chris Mole: I assure the hon. Gentleman that the number of trains on the Torbay branch line will remain the same, providing access to Torbay. The Department has received no representations from South West Tourism on this issue. If the Liberal Democrats would run rail services because they are totemic rather than because they meet passenger needs, it perhaps tells us something about how unprepared they are to take—

Sadiq Khan: Since our last questions in June, the Department has made a significant number of policy announcements. To keep in your good books, Mr. Speaker, I will keep it short. We have announced a £1.1 billion programme for electrification of the Great Western main line and of the line between Manchester and Liverpool, a £14 million package to transform facilities for cyclists at rail stations and green permit schemes for works in the street in London and Kent. We have published "Low Carbon Transport: A Greener Future", and more details are available on the Department website.

Sadiq Khan: It is fascinating how support withers away when it comes to paying for things. There is a consequence of wanting investment in public infrastructure—it costs money. One party is committed to investing—

Natascha Engel: Will the Minister let me know what practical steps his Department is taking to protect rural bus services—by practical steps, I obviously mean money?

Sadiq Khan: I thank my hon. Friend for her helpful question. In the last 13 years, we have introduced a rural bus subsidy scheme that gives more than £15 million each year to subsidise buses that otherwise would not be profitable to run. In addition, we have given more money to the revenue support grant scheme, which means that main buses can be funded. We also fund community transport buses, which leads to a number of buses being run that otherwise would not be run. She has raised the important point that social justice demands that rural communities have buses that run.

Paul Clark: In the work that we undertook for what ultimately became the 2003 aviation White Paper, a substantial review was undertaken into the impact and requirements, for the foreseeable future, of the level of air travel within the UK and for long and short-haul flights. I was recently at Heathrow airport, and although we have obviously committed to investment in high-speed rail and taking that forward, the proportion of flights to Heathrow is 8 per cent. internal and 7 per cent. short-haul—the vast majority of flights are, of course, long haul, which need to be made.

Chris Mole: Industrial relations and staffing issues are between employers and their staff—in this case, Network Rail and its employees. Network Rail is a private company and the Department cannot involve itself in the staffing and operational aspects of the company's activities.

Mark Harper: The Minister will know that my hon. Friend the Member for Cotswold (Mr. Clifton-Brown), supported by his colleagues in Gloucestershire, has been an ardent campaigner for redoubling the Kemble to Swindon railway line. Now that, as I understand it, a significant amount of money—£30 million—has become available in the south-west, will the Minister take whatever steps he can to ensure that it is used to make that necessary improvement on our rail line?

Sadiq Khan: My hon. Friend has raised an important issue. We spend £1 billion on the concessionary bus fare scheme, which enables 11 million people who are either over 60 or disabled to use buses free of charge after 9.30 am and before 11 pm who would otherwise not be able to do so. He makes an important point about access to the railways, and I will write to him to give a substantive response, but suffice it to say that we spent more money this year on such things than ever before in the history of this Government.

Tony Baldry: May an old boy ask, given the performance of Ministers today, why on earth we have a Department for Transport? Ministers clearly have no influence over rail operators' timetables. They do not know the number of speed cameras there are about. It is clear that the Highways Agency looks after the roads and that rail operators look after the railways. What on earth is the ministerial team doing? Would it not be a good start—

Sadiq Khan: Unlike Her Majesty's official Opposition, we are committed to the concessionary bus scheme and to having 11 million people in England being able to use it—as I said, free for the first time in the history of Governments in this country.

Philip Davies: The Airedale and Wharfedale rail lines, which serve my constituency, are two of the most congested in the entire north of England. When will Yorkshire get its fair share—not extra—of the transport budget to deliver the much-needed extra capacity on those train lines?

Christopher Fraser: The Minister will be aware that Norfolk is the only county in England that does not have a dual carriageway linking it to a national road trunk network. Does he share my hope that the public inquiry into the dualling of the A11 from Thetford to the Five Ways roundabout will not push back the timetable for the project? Can he also give me an absolute assurance that—

The Minister for Women and Equality was asked—

Mr. Speaker: Order. I am not psychic. I can be guided only by what has been reported to me, and I had it down that the hon. Lady wanted to favour the House with her views on this matter.

Maria Eagle: In my role at the Ministry of Justice as Minister for Prisons and champion for women in the criminal justice system, I discuss this matter regularly with the Secretary of State for Justice. As of February, there are no longer any women prisoners being routinely strip-searched in women's prisons in England, and we are investing £15.6 million of new money over this two-year period in existing third sector organisations to divert vulnerable women offenders from custody.

Maria Eagle: I am glad that my hon. Friend has seen the excellent programme at HMP Send, which I have also had the benefit of visiting. It is doing sterling work. Much of the £15.6 million of extra resources to which I have just referred is going to one-stop shops and women's organisations in the community that have an express purpose and ability to offer personal support to those coming out of prison, and to solve problems with housing and with getting children back to women coming out of prison to prevent them from reoffending. I believe that that will be very effective.

Maria Eagle: All our prisons have certain difficulties with drug-addicted prisoners, whether they are women's prisons or other prisons. I can tell the hon. Gentleman that a record investment is going into drug rehabilitation and support in our prisons—including HMP Styal, to which he referred—with 15 times more money being spent now than in 1997 on drug rehabilitation, and a record number of people engaging with it. That has to be hopeful for the future.

Vera Baird: This Government have transformed support for working parents since 1997—doubling maternity pay, introducing paternity pay and leave, more than doubling good-quality affordable child care places and extending statutory maternity leave from 14 to 52 weeks. Most recently, the Prime Minister has announced new flexibility for working parents, whereby from April 2011, if a mother wants to return to work six months after the birth, the other six months of her leave can be taken by her partner with three months of it paid. The Department for Business, Innovation and Skills is consulting on the administration of this scheme to make it as accessible as possible for both employers and employees.

Angela Watkinson: I recommend to the Solicitor-General the Conservative proposals for even greater flexibility in parental leave sharing between the mother and the father. Does she agree that that might help to mitigate against any negative impact of improved parental leave on the employment prospects of women of child-bearing age?

Vera Baird: This issue relates to the point that I have just made. The level of these benefits is such as to provide very good support to working and middle-class people who want to be able to have families and to have optimal choice between flexibility at work and home care. If, as a result of the unhappy occurrence of a Tory majority at the next election, which according to the polls is looking less and less likely—we are now down to a very limited possibility, if at all—these benefits were assaulted and slashed, many of my constituents are very well aware of the dangers that they would face.

Harriet Harman: This is a growing issue. Commanders are required to manage their personnel in a flexible manner to ensure that family responsibilities as well as military duties can be discharged. As well as supporting the responsibilities of married service couples, it is important to support their families. I pay tribute to the three service families' federations—Julie McCarthy of the Army Families Federation, Kim Richardson of the Naval Families Federation and Dawn McCafferty of the RAF Families Federation. They work closely with the Ministry of Defence and with us, and they do a magnificent job.

Michael Jabez Foster: My right hon. and learned Friend is well known to be a champion of equalities in this context. The right hon. Gentleman will be aware that the national health service constitution, published this year, puts equality at the heart of the NHS. However, he has raised an important issue, and I know that my colleagues in the Government Equalities Office will wish to continue to discuss it with the Department of Health.

Philip Hollobone: Given that Lady Thatcher was Britain's first elected female Prime Minister—

Philip Hollobone: —and the longest-serving Prime Minister of the 20th century, and one of this country's greatest ever Prime Ministers, would the Solicitor-General like to apologise to the House for the fact that her name was omitted from the fact sheet that her Department published?

John Barrett: One of the effects of the recession is rising unemployment. As we—hopefully—begin to emerge from the recession, what action can be taken to ensure that disabled people are not left at the back of the queue for jobs?

Harriet Harman: The business for the week commencing 26 October will be:
	Monday 26 October—Remaining stages of the Marine and Coastal Access Bill [ Lords] (day 1).
	Tuesday 27 October—Conclusion of remaining stages of the Marine and Coastal Access Bill [ Lords], followed by Opposition day (unallotted half-day). There will be a half-day debate on parading in Northern Ireland on a motion in the name of the Democratic Unionist party.
	Wednesday 28 October—Opposition Day (20(th) allotted day). There will be a debate on local spending reports followed by a debate on the future of the Territorial Army. Both debates will arise on an Opposition motion.
	Thursday 29 October—Topical debate (subject to be announced), followed by general debate on the social care Green Paper.
	The provisional business for the week commencing 2 November will include:
	Monday 2 November—Remaining stages of the Perpetuities and Accumulations Bill [ Lords], followed by general debate on tackling anti-social behaviour.
	Tuesday 3 November—Consideration in Committee of the Constitutional Reform and Governance Bill (day 1).
	Wednesday 4 November—Further consideration in Committee of the Constitutional Reform and Governance Bill (day 2).
	Thursday 5 November—Topical debate (subject to be announced), followed by general debate on climate change: preparation for the climate change conference at Copenhagen.
	I can announce the Commons calendar for Parliament until the February recess in 2010. We plan to rise for the Christmas recess on Wednesday 16 December 2009 and return on Tuesday 5 January 2010. For the February recess, the House will rise on Wednesday 10 February and return on Monday 22 February. I will inform the House of the dates for the Easter recess in due course.
	I should also like to inform the House that the business in Westminster Hall for 5 November will be:
	Thursday 5 November—A debate on the report from the Committee on Arms Export Controls entitled "Scrutiny of Arms Export Controls (2009): UK Strategic Export Controls Annual report 2007, Quarterly Reports for 2008, Licensing Policy and Review of Export Control Legislation".

George Young: The House is grateful to the Leader of the House for giving us the forthcoming business.
	Last week, when I asked for the parliamentary calendar, the right hon. and learned Lady said she would bring it before the House as soon as she could, but for the first time ever she has announced the Christmas and February recess dates but not the Easter dates. What problems is she encountering over the dates of the Easter recess?
	The Leader has just told the House that we are to go into recess over a week before Christmas—that is the earliest the House has risen, as far as I can recall. Back in 1997, we rose on 22 December. That was when the Government had some leadership and some ideas. Our constituents will be working long after the date that she has just announced, and Conservative Members have an unquenched thirst for doing the job we were sent by our constituents to do beyond that date. Is this not further evidence that the Government are running out of steam?
	Last week, the Leader refused to answer my question about when the Chancellor would deliver his pre-Budget statement. Can she do so this week?
	The Government are committed to replying to a Select Committee report within six weeks. When will the Government respond to the Public Administration Committee report on lobbying, published on 5 January? In March, the Minister for the Cabinet Office wrote to the Chairman of the Committee confirming that the Government would respond very soon. Since then, nothing. When will we get the Government's reply?
	On the related point of courtesies to Select Committees, will the Leader of the House give an assurance that the Government will not consistently turn down the recommendations and findings of Select Committees on pre-appointment hearings?
	May we have a statement from the Secretary of State for Work and Pensions on her Department's lamentable performance in answering questions over the summer recess? There were three days for tabling during the recess, but well under half of the named-day questions were substantively answered. Given that you, Mr. Speaker, have made it particularly clear that Ministers should respond to questions in a timely manner, is this not somewhat casual?
	Today's topical debate is about securing economic recovery. That is an important issue but, thanks to the Opposition, we had a full day's debate on it three days ago. In that debate, however, the Labour party fielded only four speakers and ran out of contributors halfway through. Does the Leader of the House not think that today's time could have been more profitably used by having a debate on the future of Royal Mail or the growing rift between the Governor of the Bank of England and the Chancellor? Will she make more intelligent use of these important opportunities for topical debates next week?
	Finally, may we have a statement next week from the Prime Minister on Afghanistan? We have long called for regular updates to Parliament, and we welcomed his statement last week. Since then, however, we have learned that there will be a second round of elections there, and additional troops have been called for. Does the Leader of the House not agree that the House should have the opportunity to cross-examine the Prime Minister next week on the security of our troops and the support that will be extended to them?

Harriet Harman: I know that the right hon. Gentleman understands this, but it is important that the wider public also realise that the recess is not holidays; it is time when the House is not sitting and Members can take the opportunity to work in their constituency. We are rising earlier than usual in December, but we are returning earlier in January.
	I will announce the date of the pre-Budget report shortly, in the customary way. I know that the right hon. Gentleman has in the past argued that there should be opportunities to debate the issues raised in the pre-Budget report on the Floor of the House. I am mindful of that, and I will make absolutely sure that, as well as having the opportunity to discuss the economy in the Queen's Speech debates, there will be sufficient opportunities after the pre-Budget report for it to be debated on the Floor of the House.
	The right hon. Gentleman asked about the Public Administration Committee's report on lobbying. The Government's response has been published and the Committee considered it this morning. He mentioned pre-appointment hearings, no doubt in the context of the appointment of the Children's Commissioner and the Select Committee on Children, Schools and Families. Since we introduced this new opportunity for Select Committees to play a part in appointments process, which gives Select Committees more scope for action, there has been the appointment of the chair of the Statistics Board, as well as hearings on the appointments of the chairs of the Care Quality Commission and the House of Lords Appointments Commission and the chair-elect of Ofcom. There have also been a new Information Commissioner and chair of the Office for Legal Complaints. I have to hand a long list of all the pre-appointments hearings, which I could read out, but the point is that Select Committees are playing their part in pre-appointment hearings. However, it remains the case that under the structure that is in place the final decision is still for the Secretary of State. That is, no doubt, illuminated by the questions asked in the pre-appointment hearings.
	On the Department for Work and Pensions written questions, the Deputy Leader of the House will meet DWP Ministers to make sure that there is a prompter response to the House. This is an important issue. All Ministers should respond promptly to Members' questions about their Department's responsibilities.
	The right hon. Gentleman mentioned the choice of subjects for topical debates. I have to tell the House that there were no proposals from any party's Front or Back- Bench teams for the topical debate this week. I encourage both Front and Back-Bench Members to make proposals for the topical debate. The right hon. Gentleman asked why we did not choose to debate the Post Office. We did, of course, have a statement on Royal Mail earlier in the week. If we are to make topical debates work, we need suggestions to be made, and I invite him to do so.
	The right hon. Gentleman asked about keeping the House updated on Afghanistan. As he said, there was a statement on that last week. As well as answering questions every week in the House of Commons at Prime Minister's Question Time, the Prime Minister appears before the Liaison Committee.

David Heath: Last week, I drew attention to the activities of the banks and the fact that they are carrying on with blithe indifference to what they have occasioned in the economy of this country. They are going back to paying their big bonuses, they are unreformed and they are not providing a service to local businesses. That view has, again, been shared by the Governor of the Bank of England during the past week, so may we have a debate on the position of the banks and, ideally, on reform of the banks—something that the Government have clearly decided they cannot face?
	Before the debate on climate change, may we have a debate on statistics? Sir Michael Scholar, the chairman of the UK Statistics Authority, is again calling the Government to account for abusing statistics—this time the official figures for greenhouse gas reductions, which he described as exaggerated. Elsewhere, the energy efficiency figures have been described as "grossly" inflated. We must have accurate figures on such issues if we are to do a good job. Perhaps it was the complacency occasioned by this abuse of statistics that allowed so many Members of this House last night to refuse to allow this House—this Parliament—to enter the 10:10 campaign. Will the Leader of the House find an opportunity for this House to debate that again? Perhaps Labour Members will then be able to repent at leisure and decide that they would like this House to join a movement that is crossing the country at the moment.
	May I make a bid for one of the topical debates that will take place over the next few weeks? As we approach Remembrance day, it would be entirely appropriate if we were to debate the military covenant. Many colleagues, from all parts of the House, have serious concerns and valuable things to say about the extent to which this Parliament and the country honour our covenant with our armed forces. May we make that the subject of one of our debates over the next couple of weeks?
	May we have a debate on police and police community support officer numbers? Although numbers vary around the country and, happily, some forces are still increasing their numbers, other forces are substantially reducing them. The number of police in Avon and Somerset has decreased, and this week we have heard that Somerset county council is, disgracefully, reducing its funding for PCSOs by a quarter. I cannot believe that it is right to cut front-line policing. That flies in the face of what people across the country expect, so may we have a debate on the issue at the earliest opportunity?
	Lastly, I am unconvinced by the Leader of the House's responses on the pre-confirmation hearings. Only one adverse report has come from a Select Committee and it was rejected within hours; unless the Secretary of State for Children, Schools and Families and other Secretaries of State take the process seriously, there is no point in having it.

Several hon. Members: rose —

Ian Liddell-Grainger: The Leader of the House is well aware that the Government want to get as much renewable energy as they can and wind turbines are one way of doing that, but they are being introduced in areas where they should not be. Nine turbines will be applied for on the levels in Somerset—an area of outstanding importance to the United Kingdom. Under the current Government proposals, the application will be put through. Please may we have a debate to discuss where these turbines should go so that their placing is not to the detriment of the heritage of this country?

Harriet Harman: We have to pick the subject for the topical debate on Monday and we knew that we were having a statement on Tuesday on the Royal Mail dispute, so we did not pick it for the topical debate this afternoon. I remind the House of what the Secretary of State for Business, Innovation and Skills said. In this situation, it is important that both sides get round the table, talk and keep talking until all matters in dispute are resolved. If they cannot find a resolution, they should look to ACAS to help them to do so. Both sides within Royal Mail need to resolve this—they know what the issues are and they know what has to be resolved, and I would continue to urge them to do that. I think that that is the right approach.

Paul Farrelly: May I ask my right hon. and learned Friend the Leader of the House—and, of course, the real deputy leader of the Labour party—whether we can have a date on the implementation date for the temporary and agency workers directive? Fairer treatment for vulnerable workers has been the subject of two private Members' Bills in this House as well as of a joint declaration from the TUC, the Government and the CBI that it would be implemented in this Parliament. May we have an urgent debate on what is going on with the directive? There is considerable anger among Labour Members at reports that it might be put off until 2011.

Nigel Dodds: May we have a debate on early-day motion 2067 on Territorial Army training cuts?
	 [That this House salutes the service of members of the Territorial Army (TA); deplores the freezing of TA training; notes the adverse impact this will have on generic war fighting capability, morale, recruitment and retention; further notes that the measure conflicts with the Cottam Strategic Review of Reserves published in April 2009 which the Government accepted in full; and calls on the Government to reverse its decision immediately. ]
	 The cuts are having a very detrimental effect. In the early hours of this morning, a bomb was discovered to have been planted at the TA base in my constituency. Reserve forces are of great value to the communities that they serve, especially in Northern Ireland. More than 1,000 men and women from Northern Ireland have served on operational duties overseas. May we have a debate on this important subject, to reinforce the importance of the TA to the Army and our country?

Harriet Harman: I strongly endorse what the hon. Gentleman has said about the importance of the TA, both overseas—and especially in Afghanistan—and in all aspects of the work of the armed services. Next week's Opposition day on Wednesday 28 October will give the House an opportunity to debate the Territorial Army.

Christopher Fraser: Like other colleagues, I was lobbied by yesterday by firefighters in my constituency who are concerned about the regionalisation of control centres. Not only has the fire control project gone hundreds of millions of pounds over budget, but the Fire Brigades Union has said that financial resources have been stripped away from front-line services. Will the Leader of the House find time in the House for this much needed debate which, according to her criteria, is more than topical?

Harriet Harman: I will take that as a suggestion for a topical debate next week, but it is not the case that front-line services are being stripped back—far from it.

Alistair Carmichael: May we have an early statement from Treasury Ministers to explain to the House what they intend to do to resolve the current dispute between the directors of Lloyds TSB and the directors of the bank's charitable arm, the TSB Foundation? The foundation's chief executive reckons that if the dispute is not resolved there are seven weeks to go before she has to wind up the organisation, with a massive loss to charitable and voluntary organisations across the country. Surely that is not what Ministers had in mind when they put £20 billion of taxpayer's money into Lloyds TSB.

Ian Pearson: I beg to move,
	That this House has considered the matter of securing economic recovery.
	The world economy is forecast to shrink by 1¼ per cent. in 2009—the first time it has contracted in 60 years. To fight the global downturn, we, with countries around the world, have stepped in to support our economy. In the 1930s, Governments failed to act, with disastrous consequences. Unlike the Bourbon monarchy and today's Conservative party, we have learned the lessons of the past, which is why we took unprecedented action to put more money into the economy, to help to support families and businesses now, to protect jobs and to ensure a sustainable recovery.

Desmond Swayne: When the recovery starts—I hope it is starting even now—one of the principal difficulties faced by small businesses will be the need for working capital. The Economic Secretary will be aware that the Chancellor has already announced means by which small businesses' cash-flow difficulties can be addressed during the recession, in particular, through the deferment of taxes. The right hon. Gentleman made it clear that that included national insurance and other payroll taxes, but I can think of no other payroll tax than pay-as-you-earn. Is PAYE included in those provisions?

Ian Pearson: The hon. Gentleman will be aware that more than 150,000 businesses have already benefited from the flexibilities operated through the business payment support system. That system, which covers payroll taxes and deferment of VAT payments, has been widely welcomed by industry and is a major success.
	In the terms of today's debate on securing the recovery, the fact that the downturn is global has meant that we need global action, as well as action on the home front. That is why the Prime Minister and the Chancellor have led the G20 in taking action to stop banks from failing, agreeing to strengthen the international financial system, and taking other measures to help to secure the global recovery. Politics is about judgment. Government is about taking decisions. As a Government, we could have allowed Northern Rock to fail; we could have decided not to take powers through the Banking (Special Provisions) Act 2008 to manage the crisis and not saved Bradford & Bingley; and we could have made the political judgment that what was needed was the complete deregulation of all mortgage markets. They would have been the wrong decisions to make in order to protect jobs and people's savings, yet they were the exact policies that the Opposition advocated at the time.

Ian Pearson: I shall certainly refer the right hon. Gentleman to the public statements made by Opposition Front-Bench spokesmen, which are a matter of record.
	If we can move on to where we are today—

Sally Keeble: Does my hon. Friend agree with the reports by the Treasury Select Committee, which scrutinised the issue? Although we on the Committee found that complex considerations were at play, we did not find that people had given advance warning of the crisis, and we supported the Government's measured approach to many of the issues—in particular, their support for the banking industry.

Ian Pearson: My hon. Friend is absolutely right to refer to the Treasury Committee's work, and to the fact that its considered judgment supported the actions that we took. The powers that we took through the 2008 Act, and the actions that we took on Northern Rock and subsequently, were right.
	Politics is about judgment and government is about making decisions, and the Government's judgment now is that it is right to support businesses and people through these difficult times. That is why we have taken action, for instance, on cutting VAT, putting an additional £1 billion each month into the pockets of shoppers and retailers; it is why we are spending £5 billion more on helping people get back to work; and why we are helping 300,000 people with their mortgages, helping them to stay in their homes. We have supported the car industry through the scrappage scheme, provided additional support for business generally and, as I said earlier, given 150,000 companies more time to pay their bills.

Philip Hollobone: rose—

Greg Hands: rose—

Greg Hands: The Minister threw out a large number of accusations about the Opposition's policies and said that we had not learned from the past. Will he therefore tell us which mistake he learned from when he decided to embark on a Government borrowing programme of £500 million a day?

Ian Pearson: I am certainly aware of Monday's Opposition day debate, which focused on welfare and its role in securing the recovery. Today, we are talking about securing our economic future, and our measures to achieve that, which the Opposition opposed, are working. The International Monetary Fund, the National Institute of Economic and Social Research and a majority of City forecasters agree that the economy should begin to grow by the end of the year. However, there are still uncertainties and risks to confront, and no country can be complacent. Unemployment is rising here and throughout the world, and we have to see the problem through. I think that it was Churchill who said, "When you are going through hell, you must keep going," and that is why at the Pittsburgh summit the G20 agreed that it was too soon to withdraw fiscal support—support that the Opposition do not even want to provide. Yet again, that agreement is in stark contrast to the Conservatives' argument today.

Ian Pearson: The west midlands is an important part of the UK economy, and the fiscal stimulus measures that the Government are taking are all helping our industry. My hon. Friend will be aware of the scrappage scheme, which has been widely welcomed in the west midlands. The region has had a very tough time during the economic recession, suffering more than many others in the economy, and that is why it is fundamentally important that we continue to up our skill levels in the west midlands and, more broadly, throughout the United Kingdom. That is also why we continue to support our companies. Those policies and spending decisions—the judgments that we are making—would be placed under threat if we followed the judgments of the Conservatives, who just want to cut, cut and cut again.

Ian Pearson: Yes, HMRC has been extremely active in wanting to work with companies and defer payments where that can help a company and provide it with the breathing space that it needs. As I said, more than 150,000 businesses have benefited, and a figure in excess of £2.3 billion has been deferred in the way of tax. If my hon. Friend has specific examples of companies with problems and wants to talk to me about them, I will ensure that they are investigated. If support can be provided to viable businesses through deferring tax payments, that is what should be happening. I am happy to take that forward with him directly.

Ian Pearson: The Government have already taken steps internationally and domestically, through regulation by the Financial Services Authority, to deal with the banking crisis. The Governor of the Bank of England, the Treasury and the FSA—the tripartite authorities—are absolutely committed to ensuring that we do not return to the past. We have said very publicly that it cannot be business as usual for the banks. In his speech on Monday, the Governor posed some interesting questions as part of a general debate. We have some differences of opinion on separation, but in essence there is not a lot of difference between what he is saying and what the Government believe in terms of the actions that are already taking place—and there is more action in the pipeline, as the hon. Gentleman will be aware.

Ian Pearson: As the House will be aware, we have significant stakes in Royal Bank of Scotland and Lloyds Banking Group. We have clearly stated that we want those entities to be returned to the private sector, and I am sure that that will happen in due course. However, there must be an orderly process. We must first sort out the problems in those banks, and we will then ensure that they are returned to the private sector at a time and in a way that delivers best value for the taxpayer.
	Looking to the future, we have ambitious plans for investing in skills in our work force, boosting research and development, and rolling out high-speed broadband. Among a range of actions, we have said that we will guarantee a job or training place to 18 to 24-year-olds out of work for a year.
	I want to stress to the House that we are continuing to invest in Britain's critical national infrastructure at this crucial time as we recover from the current crisis. That will be fundamental to underpinning our country's economic future. As we set out in the Budget, following almost a decade of rising capital investment, net investment next year—£36 billion—is close to that spent in 2008-09; and in 2011-12, well into what we hope will be a recovery, it will be close to that spent in 2007-08. That investment, which would be cut if the shadow Chancellor had his way, is providing much-needed support to thousands of UK construction workers. Meanwhile, the Conservatives have a warped sense of priorities in wanting to give a £200,000 tax cut to the 3,000 wealthiest estates.
	It was, and continues to be, the right judgment to support families, businesses and jobs to get through the downturn as soon as possible and in the best possible shape. It was also the right decision to prevent the collapse of the banking system, because the impact of a collapse on households and businesses would have been catastrophic. It is right, too, to invest in Britain's future. But we also have to make the tough decisions to take action on the deficit once the recovery is secured. We must live within our means, because money will be tighter in the years to come, and that means that choices will be even more important. We have already set out a responsible reduction plan to halve the deficit over four years, we have announced tax increases for those on the highest incomes that will take effect once the economy is growing again, and we will take the tough decisions on public spending for the years ahead. We are determined to take a responsible approach to reducing the fiscal deficit that will not damage the public services on which people rely. We will cut costs and unnecessary programmes, but continue to invest in front-line services. These decisions will be based on our values of fairness and responsibility. We will continue to make the right choices for recovery and for Britain's future.
	The shadow Chancellor's judgment has been wrong throughout the financial crisis: wrong on deregulation, wrong on Northern Rock, and wrong on the fiscal stimulus. Now his policies would kill the recovery, cutting support at the worst possible time for the economy and for people in Britain. Winston Churchill once said:
	"Success is the ability to go from one failure to another with no loss of enthusiasm."
	Judged by that yardstick, the shadow Chancellor is a success. However, I think that the general public will increasingly want to question his judgment over the coming months, and we certainly relish that debate.

Greg Hands: That was an extraordinary speech from the Minister, full of quotes from Winston Churchill without quite the style to match them. He provided an incredible example of retro-politics. It is as though he has gone back to the position that the Government held back in the spring, which was to deny the fact that there were any problems with public sector borrowing and the public sector deficit. Indeed, his only mention of the C-word—cuts—was in relation to Conservative policies rather than his own. As was confirmed by the Prime Minister's conference speech, we seem to have gone back in time to when the Government's own figures strongly laid out the fact that cuts would have to be made.
	Conservative Members very much welcome this opportunity to debate the economy. Too often in the past 18 months, the Chancellor and his helpers have sought to avoid debate or tried not to be here for the debates held in Opposition time. My right hon. Friend the shadow Leader of the House noted earlier that only four Labour Members spoke in the full Opposition day debate on the economy on Monday. I await with interest how many we will have today.

Greg Hands: My hon. Friend makes the point precisely. Labour Members are so disheartened by the Government's performance in the spring, during the party conference season and at the debate on Monday that they have voted with their feet.
	Let us be clear about one thing: the Government arranged this debate because they think that there is light at the end of the tunnel. We would welcome that, so let us hope they are right, but we should also be absolutely clear that until now the tunnel has been very long and dark indeed.

Greg Hands: I thank the hon. Gentleman for that perfectly reasonable question. I shall come on to describe how we can both put the public finances back in order, or on the right path, and do something to help the economy along.
	Regionally, the unemployment picture varies. According to the Library, the biggest percentage rises in unemployment have occurred in the west midlands and the south-west, by 71 and 72 per cent. respectively year on year. Those of us who remember the past two recessions will find it interesting that the west midlands now has the highest rate of unemployment of any nation or region of this country, at 10.5 per cent. The north-east is at 9.5 per cent., and London is in third at 9.2 per cent. The latter two regions have shown smaller increases, meaning that both are suffering from the longer-term blight of unemployment during the years of economic growth of the 1990s and this decade—yet another sign that Labour failed to fix the roof when the sun was shining.
	To return to the question of when the economy will start to grow again, we have always said that we expect growth in 2009. Nevertheless, even the predicted quarterly growth of 0.1 or 0.2 per cent.—we will know the figure for sure tomorrow—would mean that the economy has contracted by 4.7 per cent. year on year. That is no cause for celebration. Moreover, whether or not there is small quarterly growth tomorrow, the figures are already overshadowed by the appalling Government borrowing numbers that reached us on Tuesday. Britain borrowed £14.8 billion in September, the highest total ever for that month, capping off a third quarter of astonishing profligacy by the Exchequer. That is overspending of almost £500 million a day. That is like each taxpayer in Britain coming home every day and saying that they have just gone and borrowed another £20, without any sense of when the previous day's £20 will ever be repaid, let alone the interest on the previous borrowing.
	Government borrowing rose to £77.3 billion in the first six months of this financial year, more than double the already high level of debt racked up in the same period the year before. Over the 12 months to September, net borrowing was a massive £128 billion, up from an already high £47 billion in the year to September 2008. The public finances have been whacked by a double whammy of falling tax receipts and rising Government spending. Tax revenues have fallen 10 per cent. to £219 billion from £244 billion in the past six months, while Government spending has risen by an inflation-busting 4.8 per cent. from £266 billion to £279 billion.
	Labour Members may claim that those appalling figures are not relevant to the question of economic recovery. I believe the Minister was saying that the deficit was somehow an entirely separate matter from whether Britain will have a proper economic recovery, but the two are very much linked, as I shall explain in a moment.
	How can we secure a sustainable recovery? As we have said repeatedly this year, there are three essential aspects of any recovery: fiscal responsibility, monetary activism and supply-side reform. First, on fiscal responsibility, we need urgently to get a grip on our public finances. That much is obvious, except to the Prime Minister and Labour Front Benchers. That is vital in its own right, but it is also important when considering how to keep interest rates down, which will be a crucial part of our economic recovery. Huge Government borrowing will eventually push up interest rates, and the most recent figures that I have seen for the quantitative easing programme suggest that far more gilts and other fixed-income securities have been bought back than issued so far this year. Once QE has been wound up, as it must be in due course, we will need to keep a careful eye on the gilt market and other markets in which the UK might find investors for Government debt.
	Our deficit is the worst of any major country. The Government sometimes say that we do not need to worry, as Government debt in the UK as a percentage of GDP at 59 per cent. and rising is still below that of Japan at 188 per cent., Italy at 116 per cent., Germany at 78 per cent. and France at 77 per cent., and only marginally above the rate of the United States at 54 per cent.

Greg Hands: I am not saying that, I am saying that QE will have to come to an end when the timing is right. Some of the tactical and practical details of QE are best left to the Bank of England.
	To return to the deficit as a percentage of overall GDP, the crucial point is that if we divide the percentages that I mentioned by each country's domestic savings ratio, we find that we are actually in a far worse position than other countries, and possibly even than Japan. All that is before we consider any of the off-balance-sheet stuff. For some time we have had the problem that the UK gilt market is greatly exposed to weak domestic savings. Unless British households can start saving in a way that they have never done before, gilt issuance will depend on foreign demand.
	In the short term, both official and market interest rates are low at the moment, but enormous care is needed. Forward interest rates such as forward rate agreements—in other words, where the market thinks rates are headed—are much higher than short-term rates. In fact, the multiplier of long-term rates, at about eight times the level of short-term rates, may be at a record level. As I have said before from the Dispatch Box, it is worth remembering that a 0.5 per cent. increase in interest rates is far more significant when rates are low than when they are high.
	The market has already anticipated substantial rises in interest rates, and even before any such rises have taken effect, the Treasury itself projects that debt interest will rise from £22 billion to £67 billion per annum. Obviously that bill will rise substantially if interest rates rise significantly. That is another reason why fiscal responsibility is so important for our economic recovery. If the Government continue to borrow uncontrollably, not only will the interest rate bill rise substantially and potentially unsustainably but the public sector will crowd the private sector out of the credit market. Members of all parties rightly urge the giving of more credit to small and medium-sized enterprises, but that will be made much harder if we do not get a grip on the public finances, because the state will crowd the private sector out of the market.

Greg Hands: No, I do not accept that at all. In fact, we have laid out a quite extensive set of proposals to get Britain working again that are perfectly compatible with doing something about the appalling condition of our public finances. We have to recognise that we can do both—we need to do more with less.

Greg Hands: No, I am going to make a little progress.
	Specific measures to help us out of the recession have been outlined by the shadow Chancellor for some months now. A few weeks ago, we published our proposals to do something about Labour's jobs crisis: "Get Britain Working" offers a new, integrated welfare-to-work initiative. This year has seen the highest increase in unemployment on record, with more than 2,000 people a day losing their jobs. We have a comprehensive programme, including tax incentives for micro and small businesses to take on new staff, which we believe will incentivise businesses to create around 60,000 new jobs.
	The shadow Chancellor announced two weeks ago a set of proposals to get the public finances in better order. At the same time, we remain committed to real help now in the form of our £50 billion national loan guarantee scheme and funded cuts in corporation tax.

Andrew Love: The shadow Chancellor's speech to the Conservative party conference laid out savings of the order, I think, of £7 billion. In the context of the debt figures that the hon. Gentleman has been giving, that is a pinprick. We hear all this talk about fiscal responsibility. Will he lay out for us today where that fiscal responsibility will impact?

Greg Hands: I thank the hon. Gentleman for that, but it was not as good as his last question. He is being a bit churlish, because the Government have failed to outline more than a tiny amount of savings that might be made in public finances. The shadow Chancellor—

Greg Hands: If the hon. Gentleman will let me speak, the shadow Chancellor laid out pretty clearly a menu of different things that a new Conservative Government will introduce. He did not at any point say that it was an exclusive list, but it was intended to give a direction of travel and to show the rough, overall approach that a Conservative Government would take. It is too early to lay out one's plans in full, not least because we do not know what appalling inheritance we are likely to have. That is partly a result of the Government's failing to face up to the simple facts of the budget deficit.
	As I said, we have also published longer-term proposals for the economy, entitled "Reconstruction: Plan for a Strong Economy". When it comes to supply-side reform, no single policy can achieve everything, but we have begun to set out a programme of reform that I believe will be no less radical than the one that restored the UK's economic competitiveness in the 1980s and in the 1990s.
	We need to save and invest more for the longer term, and achieve a model that is both greener and more sustainable. Most of all, we need to send a powerful signal that Britain is still open for business. With the right combination of monetary activism, fiscal responsibility and supply-side reform, we can rebuild confidence in the British economy and take full advantage of recovery.
	That is the Conservative strategy for the recovery. It is the only sustainable route from austerity to prosperity. The other choice—the Government's choice—is a recovery built on yet more debt and yet more Government spending, which is just like an economic boom built on debt. It is living on borrowed time; a course which, in the name of patriotic duty, must be rejected.

John Thurso: As is often the case, my party is represented by quality rather than quantity, which I might say.
	To return to financial stability and banking, the recession is a direct result of a financial crisis. The Government were absolutely right to launch a rescue. That is not to say that they are not culpable for the reasons why we arrived in that position—that is not today's debate—but they were right to restore stability in the financial system. The real test now is whether that simply leads back to business as usual, and after being rescued the banks go back to big bonuses and ever more innovative instruments, and we start the whole merry-go-round again, or whether we come out of this with a refreshed banking system that is more responsive to the needs of commerce and industry.
	I have a strong belief, which I stated at greater length in Monday's debate, that one impact of what happened in the banking system was the use of the resource of capital in unproductive speculation rather than investment in either equity or debt in commerce and industry. I would like that to change under a rejuvenated banking system.
	I was interested to hear the comments made by the Governor of the Bank of England in Edinburgh, because they happened to mirror what I have felt for some time. We need a return to a narrower form of banking and to segregate banks whose principal role is the provision of prudent lending for commercial purposes from those whose primary role is to take appropriate risk in investment. My argument is not about utility versus casino, but about the two separate cultures that are required in such institutions. If they are mixed together, one simply gets the worst of all worlds.

Andrew Love: Is not the real problem with the Governor's proposal the same as that highlighted by the Opposition—namely, that there is no international agreement on a return to Glass-Steagall or something approximating it? Without such international agreement, it will be impossible for the UK to go ahead.

John Thurso: The hon. Gentleman, who is my colleague on the Treasury Committee, tempts me into a debate for which I do not have time. Suffice it to say that I believe it possible to construct institutions in this country that can compete very effectively internationally. I think Glass-Steagall is old language. "Narrow bank" is also difficult language, but such banks would have a separation of functions and would be more commercially viable. I would start—I encourage the Treasury to think about this—by taking Bank of Scotland out of the Lloyds group and putting competition into Scotland by making it independent. I suspect that Europe may well ask the Treasury to do that anyway.
	On my second point—restoring growth—the Government have given us a blizzard of schemes throughout the recession, ranging from the rank failures of the automotive assistance scheme and the credit insurance scheme, through to the enterprise finance guarantee scheme, which is muddling along, and up to some quite good schemes such as scrappage. However, the characteristics of the schemes have been headlines and public relations, with money not effectively getting out to the companies that need it.
	I reiterate what I said on Monday: the single biggest factor in rejuvenating the economy—the one thing that businesses in my constituency have cited as a real help to them—is the devaluation of the currency and the fact that we are now that much more competitive in our exports. That is of course nothing to do with the Government and carries its own risks in the future. We have seen the first minuscule shoots of hope appearing, but there is a real danger of a double dip. I remember the recession in the early 1980s, when the brakes went back on in 1981. That was too soon, and we went back into recession. It would therefore be wrong to end the fiscal stimulus too early. There is a balance of risk, but there is a larger risk in ending the financial stimulus too early than in ending it too late.
	The deficit problem is worse than it was in the 1940s, when we came out of the second world war. The deficit then was larger, but it was mostly dealt with by being inflated away, and that is not an option that is open to us this time. It is clear that cuts, and quite large cuts, are needed in public spending, but there is a difference between cuts in public spending that have a direct impact on front-line services and cuts in expenditure planned for the future, such as ID cards—an expenditure that we do not need to make. My hon. Friends have suggested that the Trident programme is another area for cuts.

John Redwood: I remind the House that I have business interests in manufacturing and investment management, but I am obviously not speaking on their behalf today.
	In the debate on Monday, I said that we needed to make the banks more competitive and change banking regulation at the bottom of the cycle, which is where we are now. Unless we make the banks work, we will not have a sustainable recovery. I drew attention to the grotesque distortion in the economy, in that we have very easy money at very low rates of interest for the public sector, created by quantitative easing, but a dreadful shortage of money, and high interest rates for those who can get money for the private sector. That is why we will not have a vigorous and sustained recovery such as those in China and some other big economies around the world. I hope that the Minister will bear that in mind and that the Government will do something about it, because we all want to see more jobs, more prosperity and a quicker return to the levels of economic activity of a couple of years ago. We will not get that unless we fix the banks.
	There is another huge imbalance in the British economy that has to be adjusted in the years ahead if we are to have a return to prosperity and sustainable growth. The big imbalance that the Government's policies have allowed to occur is that we are borrowing too much, consuming too much and importing too much, but saving too little, investing too little, making too little and exporting too little.
	Let us start by looking at the parlous plight of manufacturing. The sector has been squeezed and squeezed under this Government. They came to power with the best of intentions. They said that they wished to reverse the long-term trend downwards of manufacturing as a proportion of our economy. They said that they wished to reverse the balance of payments difficulties that had been experienced from time to time under Governments of both political persuasions in the previous 30 years. The Prime Minister, as an Opposition spokesman, used to specialise in going through the balance of payments figures every month and drawing attention to what he thought were unsatisfactory levels of excess imports over exports, especially in manufacturing. Well, the deficits that we were then running were tiny in comparison with the monumental deficits that we are now seeing month after month. We cannot go on like this. It is most important that activity is shifted away from consuming, importing and spending into producing, making and selling abroad.
	The Government have not been good for manufacturing, which is now only 13 per cent. of our total economy. However, I am pleased to say that we have some fine companies and good performance in certain sectors. Two sectors in which British performance has been good are pharmaceuticals and aerospace and defence engineering. Those two sectors have some characteristics in common: they employ a lot of talented people, they spend a lot on research and development, they have high returns on sales in normal times, and they have a lot of public purchasing, providing them with demand and activity for their factories. NHS purchasing is an important element of the demand for the leading pharmaceutical companies that have come here, expanded here or grown here. We also have a monopoly purchaser of defence hardware in the UK.
	One of the things that is most disappointing is how little intelligent purchasing there is in other areas to provide that kind of enthusiastic support—not a free lunch or subsidised purchasing—to sustain more industries on the back of the huge sums that the Government are spending. For example, we have had a substantial train investment programme in recent years, much of it financed by public subsidy. Much of that work has gone abroad. Was it not possible for Ministers to apply competitive purchasing but ensure, as other countries do, that those purchases benefit domestic manufacturers and create opportunities for people to set up and make things here in the UK? Why is it that so many quango chiefs, civil service chiefs and Ministers run around in foreign-manufactured cars? Surely competitive products can be found from the extremely good British factories? Many of them are owned by foreign companies, but that does not matter. The important point is that they employ people in this country and the value is added here. Why are we not able to make more intelligent use of our purchasing?

Jim Cunningham: The right hon. Gentleman's exposition of what he thinks should be done is interesting, but when he was a member of the previous Government, we had similar problems with apprenticeships. During the last recession, under the previous Government—I worked for Rolls-Royce at the time, so I know a little about this—the first casualty was always the apprenticeships. We talk about companies such as Rolls-Royce, and aid for them. The previous Government talked about lift-off aid—or something like that—but this Government brought in tax credits for companies such as Rolls-Royce and so helped them with research and development.

Andrew Love: The primary reason for that haemorrhaging, not just over the past 11 or 12 years, but over a much longer period, was an over-inflated exchange rate for the pound. We now have a more competitive pound. We need to sustain that competitive element in the value of the pound. How does the right hon. Gentleman, as a liberal laissez-faire economist—if I may call him that—believe that we can achieve that?

John Redwood: I was going to come to that; it is on my list of things that need fixing. We need access to working capital and more domestic orders to provide the volume that lowers the unit cost. We also need to keep control over the tax and regulatory burdens because most international businesses now look globally and do so on the numbers. They look at the costs, the cash flows and how easy it is to do business in each location. They do not have a romantic attachment to one country. I wish that they did—I wish that they shared my romantic attachment to my country and wanted to see success here—but they do not. They will look at the numbers and put the plant, the new jobs and the new projects in the place where they think that the numbers make sense. If the regulatory burden is too high, they will score that against the particular country—and regulation is a cost.
	Labour Members like to portray me as the man who would have no regulation at all, but that is a grotesque distortion. I have strongly urged stronger regulation of certain things in banking, and of course we need strong safety regulations in manufacturing. However, the overall balance is wrong. There is too much regulation overall. It means that there is too much cost and that we have fewer jobs as a direct result.
	Some voices on the Labour Benches have taken up an idea that I have launched into the public debate in recent years, which is that we should have regulatory budgets here. They have been adopted in Holland very successfully. The Dutch budgets do not go as far as I would like, because they just concentrate on the Government and regulation costs, whereas I also want them to include the impact cost on the businesses being targeted. However, the model is there and I urge the Government to do it, even at this late stage in this Parliament, because the sooner the signal is sent out that we want to start to curb and limit regulatory costs on businesses, the better it will be for generating new jobs here.

Andrew Love: The first impact of a competitive exchange rate will be on import substitution. Then we would hope that, as the economies of Europe, in particular, but also the United States, recover, we will be able to export. My concern—this was the question I asked the right hon. Gentleman originally—is this: when our economy begins to recover, it is likely that the exchange rate will appreciate, losing the advantage that we have had, so how do we prevent that from happening?

Tony Baldry: I am rather bemused by this debate. It needs to be understood that the subjects for topical debates on Thursdays are chosen by the Leader of the House—that is, by the Government. On Monday, my right hon. Friend the Member for Wokingham (Mr. Redwood) and I spoke in a full-day debate on employment and industry. Tragically, by halfway through that debate there were only three Labour Members in the Chamber. They included the Minister, the Parliamentary Private Secretary and the Whip on duty—in other words, no Labour Back Bencher was present for the debate. However, in the course a full day's debate, at least four Labour MPs managed to speak. Today, unless something dramatic happens between now and the conclusion of this debate, not a single Labour MP will have come into the Chamber to support the Minister. I find that extraordinary.
	I suspect that we know why this debate has been held today: because between now and the first Thursday in May next year, the Government will be desperate to try to create some kind of litany to give the impression that a recovery is taking place. However, one would have thought that a much more appropriate subject for a topical debate today would be the future of Royal Mail and what is happening in the postal dispute.

Tony Baldry: It was only a passing reference because I have had only a sentence on that subject. However, on securing the recovery, there are many businesses in my constituency that will not have a recovery if they cannot get their goods and invoices out through the post.
	Reading yesterday's  Hansard, I found it rather curious that the Prime Minister said about the postal dispute that he would
	"urge people to go to ACAS when that becomes the right thing to do".—[ Official Report, 21 October 2009; Vol. 497, c. 904.]
	Surely trying to ensure that everyone goes to ACAS without precondition to try to resolve such disputes must always be the right thing to do. I am not entirely sure what the Prime Minister meant by the rather curious line that he took.
	I am also surprised that the Government have not chosen to have a debate today on the dispute between the Chancellor and the Governor of the Bank of England. How we can have an economic recovery when the Chancellor and the Governor of the Bank of England are at loggerheads?
	Behind this debate is an assumption that a recovery is beginning. However, the Library has placed in the Vote Office the economic indicators for October 2009, a publication that makes worthwhile reading because it contains the Library's figures. They are not partisan figures from a political party or independent commentator, but the Library's figures. The economic indicators for October show that full-time employment has fallen by almost 700,000 over the year. There have never been so few people under 25 in employment in recent times. The UK economy has now been in recession since the third quarter of 2008. Also, the economy contracted in the second quarter of this year, compared to the first quarter, which was the fifth successive quarter of negative growth. However, the research paper shows that, although we are still in negative growth, France, Germany and Japan have emerged from recession.
	The paper also shows that manufacturing output decreased by 12.4 per cent. in the second quarter of this year, compared with the same quarter in 2008. As my right hon. Friend the Member for Wokingham mentioned, manufacturing industry has been getting into a desperate plight year on year. Total business investment decreased by 10.2 per cent. in the second quarter of 2009, compared with the previous quarter, and was 21.8 per cent. lower than in the second quarter of 2008. Productivity across the whole economy, measured by output per head, is estimated to have fallen in 2008, as compared with growth in 2007. In the three months to July 2009, total employment was 600,000 lower than a year earlier.

Andrew Love: May I suggest a little more humility from a member of a Government who oversaw two—I repeat, two—internally generated recessions? We all recognise the current difficulties in the economy, but does the hon. Gentleman accept that action by this Government at least had the consequence of not allowing a recession to develop into a depression?

Tony Baldry: I thank the hon. Gentleman for his intervention because it shows the Labour party's two desperate alibis. When Labour Members get desperate, they say, "Well, you know, it was even worse when there was a Conservative Government," which is a bit like saying to the Liberals, "Things were desperate when Campbell-Bannerman was Prime Minister." That approach just does not wash after 12 years in government. The second alibi is, "If we hadn't intervened, it would've been even worse." The hon. Gentleman has to acknowledge that, as I will demonstrate in a second, the deficit—the black hole that the Government have got us into—is monumental. However, let me first conclude my point about unemployment.
	The change in the unemployment rate has hit everyone. A comparison of the period from May to July in 2009 with the same period a year earlier gives an indication of just how desperate the increase in unemployment in this country has become. In the south-west of England, the seasonally adjusted increase in unemployment from the same period in the previous year was 72 per cent. In the west midlands the figure was 71 per cent., and even in the south-east it was 36 per cent.
	All that leads us to the fact that the Government have got our public finances into a complete mess. The Library reports that the Treasury forecasts that borrowing will be £175 billion in 2009-10, which is 12.4 per cent. of gross domestic product. Debt is forecast to rise to £1.4 trillion by 2013-14, which is 76.2 per cent. of GDP, excluding the impact of measures to support the banks. Those are truly horrifying statistics and they show why we can have no recovery until we have some fiscal responsibility.
	That is why my hon. Friend the shadow Chancellor of the Exchequer is right to make it clear that the Government have borrowed too much and that £1 in every £4 that the state spends now goes straight on the national debt. More of our taxes go on paying the interest on that debt than go on educating our children or ensuring that our armed forces are properly equipped. It is tragic to see the training of the Territorial Army being cut for the next six months, as many of its young men and women are now serving on the front line. I wonder just how many days' debt interest would be needed to ensure that that commitment could otherwise be met—it would probably be only one or two.
	There is no recovery for the Government to secure. They really need to address how to get the public finances back into kilter and where to make the savings in public spending to ensure that that happens. This is clearly an issue that Ministers are unwilling to address. The shadow Chancellor addressed it in Manchester, but the Government are unwilling to do so. They are simply hoping that they can get from now to the first Thursday in May next year without addressing it, and hoping upon hope that if they keep on talking about some mythical recovery, the electors will be lulled into thinking that life can go on just as it is now. The reality is that responsible, serious measures will have to be taken by whoever is elected to Government at the next general election, and that only we are showing the responsibility of measuring up to that task.

Christopher Fraser: I shall keep my comments brief, as I should like to hear the Minister respond to the perfectly straightforward points that have been made in the debate. As it is due to finish at 1.46 pm, I should like to give him five or 10 minutes in which to do that.
	We covered a lot of these matters in our debate on Monday, in which the Secretary of State for Work and Pension conceded, in response to my intervention, that she had not listened to the debate in full. There was, however, a tacit agreement that she would respond directly to the points made by Opposition Members. I hope that the Minister will give me an assurance today that the genuine points made on a constituency basis by my Conservative colleagues will be addressed directly, by mail—as soon as we can get letters through the post, that is—or via the letter board in the next couple of days. That will help us to deal with the problems that we have today, as well as those that we had on Monday, and those that we will have in future.
	I want to put a couple of points to the Minister. First, will the Government commit to applying the small business rate relief automatically to firms across the country? This relief is a significant help to companies struggling through the recession and can save small businesses more than £1,000 a year. That might not sound like a lot, but small businesses and enterprises have been the backbone of the economic success of this country for many years, and unless we build from the grass roots up, we will not have the success or the recovery that this debate purports to be about.
	Many businesses are not claiming the relief, either because they are not aware that they might be eligible, or because the procedure for claiming it is too burdensome. That just adds another layer of red tape to a small business or enterprise that is trying to do its bit for the recovery. Does the Minister agree that applying rate relief automatically would overcome this problem? Small businesses and enterprises have been an integral part of our success in the past, and we must recognise that for the future.
	Recent figures show a discrepancy between the value of loans offered to businesses by banks and the value of loans actually drawn down by them. Does the Minister agree that the two should not be confused? Surely the recovery of the economy can be secured only if Government schemes—many of which were described in our debate earlier this week—are working effectively. If they are not, there is no point in putting out a press release suggesting that they are going to happen. That merely pays lip service to a problem without actually dealing with it.

Brian Jenkins: Mention has been made of apprenticeships. Does the hon. Gentleman fear, as I do, that the recessions of the 1980s and 1990s, and now this recession, might well have pushed a critical mass of employees in manufacturing—and in engineering, in particular—down to a level at which we are no longer able to regenerate and reskill ourselves? Does he agree that it will take direct Government involvement to re-establish our manufacturing base?

Christopher Fraser: At the moment, 1 million 16 to 24-year-olds are out of work. As I said earlier, apprenticeship schemes are an enormously important way of training people to get back into the work force. However, the red tape and bureaucracy that we are now suffering from are stifling companies and preventing them from dealing with their problems. The hon. Gentleman must accept that there are now 2 million fewer jobs in manufacturing in this country. That has happened over the past 12 years, and it is not good news. There has not been the necessary investment by this Government in the backbone of British industry and the manufacturing sector that we rely on now and will rely on in the future.
	Thetford, in my constituency, is a great manufacturing and engineering base. The businesses there want to work and to make a contribution, but every time they take a step forward, they have to take two steps back because of the way the Government treat them over employment, bureaucracy and the regulations with which they have to comply in order to get their products into the marketplace. Of course that adds a burden of cost to those businesses and makes them uncompetitive. The Government have not walked up to that problem, and I do not believe that they will do so. We need a change of Government—we need a Government who understand the dynamics of business and how that affects the economy.
	If we are going to get out of this recession, businesses need to know that the Government are listening. I do not believe that they are. Businesses are being stifled. I believe that there is now adequate time for the Minister to address these problems. At the end of the day, the people of this nation need to know that they are being listened to. Alas, that did not happen in Monday's debate. The Minister is an honourable and decent man, and I hope that he will address these issues today. If he cannot answer all our questions, because there are not enough officials in the Box to give him the necessary responses, will he, having read  Hansard at the end of the day, have the courtesy to come back to us on every point that we have made? These are serious issues that need to be dealt with, constituency by constituency, as a matter of urgency now, and not by another topical debate in a few weeks' time.

Ian Pearson: With the leave of the House, I should like briefly to respond to the debate.
	We have heard the usual contributions from the two Opposition Front Benchers, as well as speeches by the right hon. Member for Wokingham (Mr. Redwood) and the hon. Members for Banbury (Tony Baldry) and for South-West Norfolk (Christopher Fraser). I did not hear any specific references to his constituency in the hon. Member for South-West Norfolk's speech, but I will say something in a moment about the automation of small business rate relief.

Ian Pearson: Let me respond first to the point about small business rate relief, which was the subject of quite a lot of debate some months ago. There is now a greater understanding among small business organisations about what is in place at the moment. Steps have been taken to make it easier for small businesses to claim rate relief. The systems in Wales and Scotland are not necessarily automated in the way that some of us are led to believe. It is very easy indeed for businesses to get this relief—as I understand it, it is automatically rolled over once they qualify for it. The evidence I have seen suggests that the vast majority of businesses do actually claim the small business rate relief. If I can provide any further information on that issue, I would be happy to do so, as I agree with those who say that small businesses are an important part of the UK economy. It is right that we, the Government, are seen to support them.
	I do not have time to go into the detail of all the things that the Government have done over the last 12 years to support small businesses and, indeed, manufacturing, but I would like to have a go at describing at least some of them. The first thing I have to say, however, is that those of us who have a memory—those who actually remember the previous Government—find it very difficult to stomach hearing Conservative Members talk about the importance of manufacturing.

Christopher Fraser: rose—

Ian Pearson: Some of us feel almost violently sick when we hear people talking about—

Several hon. Members: rose —

Ian Pearson: I accept what the hon. Member for Banbury said—that we now live in different times—so if the Conservative party has really changed its spots when it comes to wanting to support manufacturing and apprenticeships, I, for one, welcome that. The more we can reach a consensus around the key long-term decisions that need to be taken in the strategic interest of the UK, the better it will be for all of us.

Christopher Fraser: rose—

Ian Pearson: My hon. Friend is absolutely right to point out that this country needs skilled engineers. There are continuing issues about skills at all levels of the skill range. One of the few points made by the right hon. Member for Wokingham with which I agree was that we need to address skills issues. I agree that we need the right skills and that access to capital is a fundamental issue, as are planning and land issues. These are all important if we are to get it right and ensure that the UK is competitive in the future.
	When it comes to access to capital, I hope that the right hon. Gentleman will welcome the lending commitments that the Government have negotiated with the RBS and Lloyds banking group as part of the recapitalisation programme. I hope he will welcome the Government's enterprise finance guarantee and the work we have done with the European Investment Bank to ensure that additional loans are available to small and medium-sized businesses in this country. All those are important steps.

Christopher Fraser: rose—

Ian Pearson: If the hon. Gentleman will allow me, I would like to respond in the two minutes remaining to some of the other points that he and others raised in the debate.
	Let me update the House on the deferral of business taxes, which, as I said in my opening remarks, is benefiting 150,000 businesses. The latest figures say that £3.8 billion in business taxes has been deferred. To provide clarification for Members who asked about it, this includes corporation tax, VAT and PAYE.
	It is also important to recognise that the UK has responded, as have other countries, by introducing a fiscal stimulus. We have had previous debates on whether the VAT cut is working, and I find it surprising that some of the same people who criticised us and said that the VAT cut has not made a difference are now making representations asking us to extend it because they really want it.
	People need to accept the fact that government is about making decisions on the basis of good political judgment. Our judgment was that it was right to recapitalise the banks and right to provide a fiscal stimulus—and we believe that it is right now to continue to ensure that we secure the recovery, without undertaking the huge cuts in expenditure that the Conservative party is now advocating. The Conservatives were wrong on the recession and they are wrong now about the recovery. They have a very dangerous set of policies indeed, so I hope the general public will wake up to the fact that they need to exercise their judgment very carefully over the next few months.
	 Question put and agreed to.
	 Resolved,
	That this House has considered the matter of securing economic recovery.

Edward Leigh: I beg to move,
	That this House takes note of the 1st to the 6th, the 8th to the 11th, the 13th to the 23rd and the 31st Reports of the Committee of Public Accounts of Session 2008-09, and of the Treasury Minutes on these Reports (Cm 7568, 7622 and 7636).
	It gives me great pleasure to move this motion, which stands in my name and that of other honourable members of the Public Accounts Committee. Whatever else the election will bring—we do not know—it will call time on my chairmanship, and I will have to make way for whoever is fortunate enough to become the 46th Chairman of the Public Accounts Committee. Our next bi-annual PAC debate is not scheduled until next April, and I suspect hon. Members may have other things on their mind rather than being in this Chamber to attend that debate. This will probably be the last such debate of this Parliament, so it provides a good opportunity to reprise on what we have tried to achieve in this Parliament and to reflect on what we might achieve during the rest of it.
	Our special position in Parliament, which is reflected in these debates, stems from our focus, which is completely unlike that of any other Committee. We focus on the actions of senior civil servants in implementing policy, rather than those of Ministers in deciding it. We never interview Ministers; we only ever interview civil servants—no doubt to the relief of many a Minister.
	Talking of Ministers, I must welcome the Exchequer Secretary to her place. I hope that she enjoys her current incarnation as much as she did her previous time as a very valued member of our Committee. I am sure that her personal experience on the PAC convinced her, as has mine, of the desire of all members of the Committee to maintain our independence of thought and to divorce ourselves from the murky old waters of partisanship. One of the nice things about this three or four-hour debate is that we do not get involved in party politics at all. One thing that I am most proud of in the 391—or whatever number it is—Committee meetings I have chaired is that we have never had a single vote, not one.
	I shall thank all members of the Committee later, but at this point I would like particularly to thank the Father of the House, the right hon. Member for Swansea, West (Mr. Williams), who cannot be here today as he has had to go back to Swansea for constituency engagements. He is a long-term member of the Committee who has given me invaluable advice for many years. I am very grateful to him for what he has done for the Committee and I particularly want to put my thanks on record.
	So what is our purpose? It is simple—to demand that taxpayers' money is well spent in the pursuit of better public services. Whichever corner of whichever political party one sits in, how could one disagree with such objectives, especially in the face of the fiscal tsunami that is breaking around us? We are all aware of our difficult financial plight, as national debt has reached worrying levels and small businesses and ordinary people are struggling to keep their heads above water. So, whichever party finds itself occupying the Government Benches after the next election, then, sensible ways to reduce public spending will be all the vogue. The current talk of cuts and savings highlights the importance of the Committee. There is spin and there is counter-spin, but those are not our department: it is to protecting the taxpayer's money that the Committee dedicates itself, week in, week out.
	I believe that the reports we are debating, and the many other reports that we have produced for this Parliament, shine an unbiased light on how Government can save literally billions—thousands of millions—of pounds by applying good sense and common practice to public services. There are no radical new ideas; it is simply a case of plain common sense in the way in which public services are run.
	Sometimes our hearings leave me wondering whether too many people ignore the basics of good administration because it all seems too obvious, or because it has all been said before. Perhaps it has been said before, but that does not necessarily mean that it has been applied. Civil servants do not need to reinvent the wheel. Simply by looking at the problem, taking on board sound advice and acting in a planned, considered and thorough way, they can save themselves time, money, and a grilling from the PAC. Whoever wins the next general election, I hope that we shall not immediately see a blaze of new initiatives and new policies. The first thing that we should do is do well what we have already undertaken.
	According to information that I have received from the National Audit Office, over the eight years since I took over the chairmanship of the Committee in 2001 the action taken by Departments in response to our recommendations, including those in some of the reports that we are considering today, has saved the taxpayer, at a conservative estimate—that is "conservative" with a small "c"—more than £4 billion. I wish that all the members of the Committee could have received a 1 per cent. commission. I do not know whether  The Daily Telegraph is listening to this, but that would have given each of us the tidy sum of £40 million. I think that we would have been cheap at the price. We have heard so much bad publicity about Parliament over the past six months; what a pity that newspapers are so uninterested in the solid hard work of Committees such as ours. I do not think that £4 billion is a record to be sneezed at.
	I must thank all Committee members past and present. Later, of course, I shall be delivering my usual thanks to the National Audit Office. Let me say straight away that we on the Committee claim absolutely no credit for this. The reason why ours is the most effective Committee in Parliament is that we have 800 civil servants working for us. They provide us with the bullets and we fire them. However, I must thank all the Committee members who work so hard firing those bullets at the civil servants who appear before us.
	In debates such as this, there is a danger of our becoming too self-satisfied. Let me quickly come down to earth, and say that we have not achieved nearly enough. We can still do much more. If we extrapolate the savings that have already been achieved in some areas, or examine the scope for bringing the costs of functions that are common across Government into line with the best, we see that billions more could be saved. There is absolutely no doubt about it. That is not me speaking. According to the National Audit Office, whose members are not politicians and are not trying to make a political point, we could save billions more without changing a single policy, simply by doing better what we are already doing.
	I have written to the Chancellor of the Exchequer, and I shall place the letter in the Library because it is a public document. It will also be copied to my hon. Friend the Member for Tatton (Mr. Osborne), the shadow Chancellor, and the hon. Member for Twickenham (Dr. Cable), the Liberal Democrat shadow Chancellor.
	It will come as no surprise that in writing the letter, I received some help from the National Audit Office. It contains the accumulated thinking of myself and the NAO on how we could save more money by doing things more efficiently. I hope that it will serve as a useful adjunct to public debate over the next six months. It sets out five areas where savings and improvements have been made, and where we think that more could be achieved: better financial management, better information management, reducing complexity and improving processes, exploiting the scale of spend, and improved outcomes. I hope that the House will forgive me if I go through them one by one. I think it terribly important, because I am not sure that anyone else has conducted a study of this kind independently.
	We believe that £560 million has already been achieved by Government implementation of some of our recommendations. Effective financial management helps Departments to manage their budgets, to allocate resources to achieve priorities, and to deliver services cost-effectively. The introduction of resource accounting in 2001-02 was intended to realise those benefits, but the financial management of Departments remains a long way short of the world-class aspirations of Government. Basic management actions can result in considerable financial savings.
	Here are just a few examples of what can still be achieved. As I said, we believe that we have saved about £4 billion. What can still be achieved? The sum of £29.2 million is still to be saved through improvements in Ministry of Defence stockholding. The MOD has a long history of holding too much stock of the wrong type, and of shortages of key items needed on deployed operations. We have produced numerous reports on that. We concluded that the MOD needed to take radical action to tackle its inventory management and bring it up to the standards of modern supply-chain management. Following our report, the MOD agreed an impact of £29.2 million.
	As for museums and galleries' commercial operations, £15.3 million could be saved. Museums and galleries' poor business skills meant they were making losses on activities that were supposed to generate income. The Committee recommended that they set five-year targets for income growth with milestones supported by plans based on a systematic review of their assets and opportunities, an appreciation of which areas are most profitable, and an assessment of the risks.
	We can give further examples of what could be achieved. For instance, there are potential savings of £1.3 billion in reducing running costs. Benchmarking costs would enable Departments to see how they compare with others. That is a very simple thing which does not happen enough in Whitehall. Considerable scope for savings exists in other running costs. For example— this calculation is based on the 2007-08 figures— £464 million could be saved if the Department for Communities and Local Government, the Home Office, the Department for Environment, Food and Rural Affairs and the Department for Transport brought their accommodation costs per staff member down to the same level as those of the former Department for Business, Enterprise and Regulatory Reform, while £85 million could be saved if the accommodation costs of the Department for Work and Pensions were brought down to the level of those of Her Majesty's Revenue and Customs, and £813 million could be saved if the DCLG, DEFRA, the DWP and HMRC brought their IT costs per staff member down to the level of those of the Ministry of Justice.
	I am sorry to rattle through those figures. They are all in writing and they will all be in the Library, but it is important for me to put them on the record to show that by means of simple benchmarking—if every Whitehall Department performs at the level of the best—we can achieve enormous savings in Government.
	The next big area of potential saving is, of course, staff numbers. I am not talking about changing a single policy. I am not talking about affecting any efficiency in the front line. I am not talking about taking away a single nurse, doctor, teacher or soldier. We believe, however, that there are potential savings of £2.5 billion to be made. Some Departments have cut staff numbers in recent years, and they are to be congratulated. I am thinking particularly of the DWP, HMRC and the MOD. Savings in the staff bill have, however, been offset by salary increases above inflation, redundancy payments and increased staff numbers in the health sector, the Home Office and the Ministry of Justice. We believe that an estimated £1.7 billion could be saved across Government if all Departments matched the level of staff reductions achieved by the DWP, HMRC and the MOD. If the higher-cost Departments reduced their average costs to the level of those of the Ministry of Justice, the saving across Departments would be about £800 million. We believe that those savings could be achieved without any impact on the front line.
	Talking of not affecting the front line, what about back office costs? We believe that there are potential savings of £1.4 billion. In 2007, the Cabinet Office estimated that £1.4 billion of the £7 billion that central Government spend annually on finance and human resources—is that not an incredible figure?—could be saved if Departments shared back-office functions. Despite considerable discussion and planning, so far we regret that achievements have been limited.
	So far £1.2 billion has been saved as a result of the work of the Committee but better quality information and better use of information can improve the quality of services and stem the leakage of public money through fraud and poor compliance. Our work to improve information management has led to impacts totalling £1.2 billion. These are some examples of what has been achieved, but the scope for Departments to do more is considerable in terms of better information management.
	By following our recommendations, HMRC has increased corporation tax yield by improving the way in which it interacts with businesses. HMRC implemented a more structured approach to risk assessment and engages directly in the management boards of businesses that pose higher risks.
	Levels of television licence fee evasion fell following our recommendations to ensure that the related database was complete and accurate and that anti-evasion activity was better targeted. A total impact of £50.2 million was agreed.
	The next big area on which we believe more work can be done is reducing complexity and improving processes. Badly designed and overly complex services waste resources and frustrate the citizens who have to use them. From 2001, a total financial impact of £812 million has been agreed including, for example, £110 million from DWP following our recommendations on how to reduce errors, appeals and delay in the medical assessment of sickness and disability benefits.
	We have identified further areas where simplification can result in significant savings; for example, there is a potential saving of £2.6 billion in public sector construction. Improved processes include reduced volatility and uncertainty in work, funding to allow the supply side to invest in skills and innovation and appointing fully integrated supply chains. These are some of the basic steps needed to release at least £2.6 billion of annual savings in public sector construction. I am sorry to blind the House with all these figures but they are important; we are not talking about cutting the real work of Government but about making Government so much more efficient so that we can all do more to help ordinary people to get on with their lives.
	Benefits reform is a huge area on which I can touch for only a minute or so. There are potential savings of more than £110 million. Options for reform that should generate efficiency savings over time include simplification of the overall system, on which we could have a three-hour debate alone. We have a hugely complex benefits system in which at least £100 million could be saved. Greater efficiency and innovation in helping people into work and improving the administration of housing benefit and tackling bureaucracy have a potential saving of £10 million.
	The next area is exploiting the scale of spend. We believe that we have achieved about £1.1 billion-worth of savings so far. As the UK's biggest customers, the Government have considerable scope to exploit their purchasing power and to improve how they finance and handle commercial contracts. There is virtually no debate about this, but the scale of potential savings is huge. The Committee has published more than 70 reports on private finance initiative deals, and the cumulative effect of our recommendations has led to improvements in the PFI procurement. We do not simply believe that; we know it.
	Departments are significant consumers of private sector goods and services but have been slow to exploit their bulk purchasing power. They must demonstrate capability in managing large commercial contracts. The Government have not done that very well. Our reports on procurement have generated agreed impacts of £1.1 billion. Implementation of the recommendations across Government led to impacts in 2007 and 2008 totalling £142 million.
	Prescribing is another huge area. The pharmaceutical industry spends £850 million a year on marketing products to GPs—an incredible sum. We found that the NHS was spending at least £200 million more each year because of GPs prescribing too high a proportion of higher-cost branded medicines. Our recommendations that primary care trusts take steps to ensure GPs prescribe more cost-effectively and on the introduction of benchmarking between primary care trusts resulted in a switch from branded to generic drugs and a saving for the NHS of £157 million—money that can be applied to the front line.
	We have identified further areas where Government could better exploit their purchasing power. For instance, on food procurement there are potential savings of £220 million. By developing commercial skills and knowledge about the specialist food and catering markets and more joint purchasing, savings of £220 million in food procurement are possible by 2010-11.
	On goods and services there are potential savings of £520 million. The Office of Government Commerce's Buying Solutions enables Government to buy goods and services for their portfolio of products and reports, which can result in significant savings, but by driving performance across all activities and enhancing staff skills and incentives, there is potential for at least £520 million of extra savings.
	We have had reports on the use of consultants and there are potential savings of £408 million. We agree that the Government have made progress in achieving efficiency gains in the use of consultants, but there is a lot further to go. By combining reduced spending with better value for money, there is scope to find £408 million.
	Our recommendations to improve social and environmental outcomes have resulted in a total agreed impact with the Treasury of £217 million, but there is scope for public bodies to do a lot more. For instance, a fifth of all car crime happens in car parks, but only a small proportion of public bodies across the country has established secure car parks. We recommended actions for the Home Office to raise police detection rates, improve the effectiveness of automated number plate recognition and make car parks more secure. Implementing those actions resulted in a fall of vehicle crime that produced a total agreed impact of £23 million. That is a tiny example in one small area of achieving an impact of £23 million.
	In 2001, DEFRA estimated that 8 per cent. of the land area in England was at risk from flooding from rivers, tidal rivers and estuaries, and we have all had many representations on that. We recommended that the Environment Agency improve its urgency on flood warning systems to protect life and property. We also concluded that the agency should take action to ensure the most effective use of the funds available for inland flood defences. After DEFRA acted on the Committee's recommendations, a financial impact of £21 million was agreed in 2006.
	I apologise for rattling through that and hope that I have not bored the House too much, but I felt that it was terribly important to put on the record what we have achieved so far and what we believe could be achieved. No matter who wins the election, the Treasury has been given a potential saving of £9 billion—not by me, but by the expertise of the NAO officials behind what I have said.
	There is more we could go through were we allowed more time. What I have read out is by no means a definitive list. For instance, our 14th and 20th reports—on Chinook and on the major projects report—suggest plenty of scope for further improvement in the MOD. There are plenty of other areas on which I have not touched.
	My quick calculations show more than £9 billion of potential savings waiting to be grasped by the Treasury. That may not have been scrutinised rigorously, line by line, in the Committee, but it indicates clear potential. On this the PAC and the Treasury are on the same side. The Treasury knows that there is great potential to make savings from better administration. Indeed, it has previously set targets to save tens of billions of pounds, not least in the operational efficiency programme, but potential and targets amount to nought without action that realises them, and in many cases the action needed is nothing more radical than effective administration—simply getting the basics right, every time in every Department. I do not claim that that is an original thought, but that does nothing to diminish the value behind the thought.
	The Committee's 17th report found another area where getting the basics right would reap rewards. We found that central Government Departments spent a huge amount—more than £12 billion in 2007-08 alone—buying in services such as IT and facilities management. If we buy a service in business, or in real life, we look out for every single pound because we know the other guy is doing just that, but cosy relationships and a lack of control prevail. After analysing those huge contracts, the National Audit Office advised the Committee that about £300 million could be saved each year. It is high time that Departments subjected suppliers to the public sector to the same pressures that those suppliers face in business. No taxpayer's pound should be an easy pound of profit, but too often it is.
	In order to show how that can be done, let me give an example that was presented to the Committee. In 2003, the Committee investigated how the Prison Service bought goods and services. To be honest, we were not very impressed, but the Prison Service dealt with our report with sound common sense. It paused, acknowledged the situation, took expert guidance and set about putting things right. The Committee returned to the Prison Service in our sixth report, and we found that changes to its procurement approach had saved £120 million over five years. That is a great achievement, and I am very pleased to give the Prison Service the credit it deserves today. I would say this to officials: "Don't be shy. When you save money, change a process or control a system and find efficiencies, shout about it."
	We had the Foreign Office in front of us yesterday; the permanent under-secretary Sir Peter Ricketts appeared before us. It had one of the poorest financial management systems, but it has achieved a great deal. The Treasury must ensure that such good practice is spread around Whitehall. Departmental counterparts must be told how they can achieve it too, to help make it common practice, not best practice. There are too many examples of best practice in Whitehall, in the sense that often what we suggest in a report might be acted on by the Department concerned but other Departments do not take up the recommendations.
	We have the bundle of reports on the Table before us, and I do not want to go through all of them, because I have taken up enough time.  [Interruption.] No, no; it would take too long, and other Members wish to speak. Let me offer a couple of examples, however.
	I am proud of what we have done in trying to shine a light on some of what I call the Cinderella areas in the NHS—those areas of medicine that were not given the priority that perhaps cancer or heart services were given. The Committee has achieved a great deal in bringing to light deficiencies in how we deal with stroke patients and hospital-acquired infections, for example, and we produced a very good report on end-of-life care. The fact is that most people would prefer not to die in hospital, but because of a lack of NHS and social care support services many people do so when there is no clinical need for them to be there. There is a lack of training in basic end-of-life care among front-line staff. The Department acknowledged in its reply that such care has not always had the priority it should have had and recognised the need to improve the provision of care for adults. I hope that we can make progress on that, therefore.
	Let me turn to the Commonwealth Development Corporation—I am chopping and changing from one issue to another, as we deal with every part of Whitehall. The level and nature of CDC executive remuneration is relevant to its efficiency. The remuneration of the chief executive—of what is, after all, a public body—increased from £383,000 in 2003 to £970,000 in 2007. We were not very impressed. Admittedly, that huge increase in his public sector salary, now amounting to the best part of £1 million a year, reflected CDC's exceptional financial performance, and advisers concluded that CDC executives were paid below the median for such a group. That is fair enough in that they could probably earn even more in the private sector. However, CDC does not compete for cash to invest, offers high job satisfaction and has since 2004 successfully recruited and retained talented staff, so why are we paying so much to the chief executive?
	On Her Majesty's Revenue and Customs, tax credits and income tax, it is true that policy changes have helped HMRC to reduce recoverable overpayments from about £1.9 billion to £1 billion annually, but it has not given claimants the support that they need in making claims and reporting changes in circumstances, and it is planning to introduce new measures again. HMRC estimates that in 2006-07 claimant error and fraud led to incorrect payments of between £1.31 billion and £1.54 billion. That shows the amount of work that has to be done. We should also remember that these are only a few examples taken from across Whitehall.
	The Ministry of Defence's ability to sustain its nuclear deterrent in the future is dependent on the collaboration of the United States. We found that the new class of submarine is likely to remain in service beyond the extended life of the existing Trident D5 missile, which will be renewed in 2042, and must therefore be compatible with any successor missile developed by the US. The MOD has received a series of assurances from the US that any new missile will be compatible with the UK's new submarine class, but assurances are not enough. Nevertheless, the concern remains that the MOD has no direct control over the development of new missiles.
	The Chinook mark 3 helicopter project has been a catalogue of errors from the very start. We reported on it several times. The original contract is ill defined, preventing easy access to software source coding that was key to enabling certification of airworthiness. Further operational requirements and difficult commercial negotiations led to a protracted five-year negotiation period and slow decision making under a contract known as "fix to field". We have reported on that many times, and we hope things are finally coming right.
	I shall offer one final further example, taken from the bundle of documents on the Table, to show what we are trying to achieve. Last but not least, I turn to the national programme for IT in the NHS. We could have a debate on that alone. The Care Records Service is at least four years behind schedule, with the Department's latest forecast putting completion at 2014-15. By the end of 2008, Lorenzo, the care records software for the north, midlands and east had not been deployed throughout any acute trust and in only one PCT. Given that we are now talking of spending £12 billion, that is not good enough.

Richard Bacon: In light of what my hon. Friend has just said about the national programme for IT, does he agree that the Treasury minute answering conclusion 6, which basically says that the Department remains confident in the potential of both Cerner's Millennium and Isoft's Lorenzo to work effectively, is remarkably optimistic?

Edward Leigh: We have found that the Department has been consistently optimistic. We wish it well, of course, but given the sums involved—£12 billion—this is very worrying.
	I will not list any more examples. Within the terms of the debate, other Members may refer to more of them if they wish to do so. We might get one more chance before the end of this Parliament to have a debate, but we do not know. Therefore, may I just thank a few people? I thank my colleagues in the Chamber, and those who currently serve on the Committee or have done so over the past eight years. They have to dedicate a great deal of time. The Committee meets twice as often as any other Committee and has a huge amount of paperwork. I also thank the Committee staff, particularly our former Committee Clerk, Mark Etherton, who has just left the role. I welcome our new Clerk, Sîan Woodward, who I am sure will be a huge asset to the Committee.
	I cannot talk about the PAC's work without acknowledging the National Audit Office. It has a new head, Amyas Morse, whom the Prime Minister and I appointed last year. Mr. Morse is the first qualified chartered accountant to become the Comptroller and Auditor General. He continues to provide the PAC with excellent evidence, on which our work depends. He takes over the NAO's reins with relish, succeeding Tim Burr, who I also thank. I know that the organisation will go from strength to strength under Mr. Morse's leadership. I welcome the publication of those parts of the Constitutional Reform and Governance Bill that will place important changes to the NAO's governance on a permanent footing. We have modernised the whole organisation and it has a proper board of management, so I hope we can now move forward.
	Finally, surely it is high time that the benefits of public scrutiny to which I have referred can be applied to other areas. I shall end on this point, because it is perhaps the most important. The NAO is denied regular access to three hugely important and publicly funded bodies: the Bank of England, the BBC and the Financial Services Authority. I welcome the Culture Secretary's recent statement:
	"It is time for the BBC to allow the National Audit Office access to its accounts."
	I agree with that, although it is not before time. The BBC spends billions of pounds of public money and it should be fully accountable to Parliament—there is no threat to its editorial independence. The CAG should have statutory financial and value-for-money access to examine how the BBC spends public money. That should prevent a recurrence of the difficulties that he met in his study on the BBC's radio production efficiency when, disgracefully, the BBC tried to limit his remit—that must never happen again. Given the Government's vital interest—and now investment—in the financial sector, it would also make sense for the CAG to audit the FSA and the Bank of England. The Bank is spending billions of pounds of public money, so it should be properly audited through Parliament and be accountable through Parliament and the Public Accounts Committee.
	Now is not the time for us to address this—we will start by dealing with the Bank, the FSA and the BBC—but in the next year, in the next Parliament, it will be time to renew the civil list, for which more money will doubtless be asked. That will be a good opportunity for the civil list also to be subject to the scrutiny of the PAC, the NAO and Parliament. That is for a future Parliament to decide. We can make progress now on the BBC, the FSA and the Bank. I hear very encouraging noises from the Treasury on that, so I very much hope that the Exchequer Secretary to the Treasury will in her summing up be able to give more encouragement than we have had in the past.
	Beyond this House, the coming months will prove rocky for many of our constituents; there will be tough decisions for individuals and for the country at large. I urge those from this House who make such decisions to keep in mind the work of the PAC, and to remember—I say this to the Treasury—that we are a friend not a foe. We seek to ask the questions our hard-pressed constituents would ask, and our interest is in striving for better results for the taxpayer. If we make a few witnesses squirm, it is because every pound that our constituents give matters. It is a pound less for their businesses or their families in hard times; their contributions should be spent with respect. That is the common purpose of our Committee, and I commend the motion to the House.

Colin Breed: It would be very difficult for the Chair of the Public Accounts Committee, the hon. Member for Gainsborough (Mr. Leigh), to thank himself, so may I thank him on behalf of all of us? We are deeply appreciative of the work that he has done in the eight years—he will be there a few more months yet—on the Committee. He has raised its profile considerably in the public mind, used the media properly, exposed things that should have had light shone upon them and given good advice—I am surprised that it is only £4 billion that he has saved. His overview, which is contained in his letter—I fortunately received a copy of it—is an excellent summary and the starting point into which any future Committee should look deeply.
	As the hon. Gentleman says, the Committee is not about just saving money, although that is extremely important; its work often has other, almost better, implications. In this regard, I can think of two of the things that he mentioned in passing, the first of which is secure car parks. Anyone who has had their car broken into or damaged in a car park will use their insurance, but they will encounter the hassle, work, inconvenience and so on that persists from that. It is unquantifiable financially but has a huge effect on people's lives. If we can save money and avoid that, it must be good for everyone.
	My second example relates to flooding. I do not know the number of Members whose constituencies contain areas prone to flooding, although the figure is probably more than we realise; the number of such areas has been increasing in recent times. My constituency has suffered major flooding near the coast. Insurance is becoming more difficult to obtain, and the sheer heartache, stress and so on that is visited upon people when they have been flooded is enormous. Again, that is financially unquantifiable, but we must begin to understand that not only is saving money a good thing in its own right, but that doing things better can have even more profound outcomes. I congratulate the hon. Gentleman, his Committee and the National Audit Commission on the work that they have done. They have had some notable successes and I am sure that there will be many to come.
	I am a member of the Treasury Committee. I suppose that everybody thinks that their own Committee is the most hard-working, the most valuable, the best organised and so on, but when I knew that I was going to be responding in this debate, I looked at the work of the Public Accounts Committee and was astounded at the amount that it has got through—the reports that it has produced and work that it has done. Although members of the Treasury Committee may feel that we do a lot of work, we have to acknowledge that the work done by the PAC is impressive.
	I, too, wish to refer to just three of four reports that have been important to me, as well as to my constituents and others. The first such report, to which reference has been made, is the one on the Ministry of Defence and the Chinook Mk 3. Although my constituency is that of South-East Cornwall, it is close to Devonport dockyard and the Royal Marines, and many of my constituents have direct relationships with our troops. Within that community, and slightly wider than that, the saga of the Chinook Mk 3—those eight years of incompetence and bad decision-making, let alone the enormous cost and so on—has gone down extremely badly. At a time when we have seen inefficiencies and the lack of some equipment, the thought that millions of pounds have been wasted on machines that will not even get into the air for years and the basic mismanagement that that has brought out has left a sour taste in a number of people's mouths. The Ministry of Defence appears to have frittered away, through bad decisions, millions and millions of pounds, yet it seems to be penny pinching on some of the vital equipment that our troops need when they go into theatre.
	Clearly, many lessons can be learned across the board about the way in which contracts are negotiated, if we cannot get that sort of agreement with our so-called allies—with the people who are supposedly helping us in these situations. I am at a loss to understand how we have got to a situation in which we cannot sort out the software source coding with a great deal more alacrity.
	The next report—the 11th report, on the UK's future nuclear deterrent—follows on from that. Devonport dockyard is the home of Trident when it is being refitted. It has been an enormous boost to the local economy and significant numbers of my constituents work there. The beginning of the debate on Trident has been watched with great interest and this report is a good start to what ought to be a full debate on the costs of the defence side as well as on all other aspects relating to this major policy area.

Colin Breed: We are not in favour of renewing it, but the decision does not need to be taken now. We have at least another four years before we have to make the final decisions. In those four years, all sorts of things could happen, such as proliferation in states such as Iran, a greater sorting-out of the technology and a better understanding of the alternatives and their costs. I do not think that the debate has reached a point where anybody can make a final decision. There is an objection to Trident in general and to its amazing costs—indeed, my hon. Friend the Member for Twickenham (Dr. Cable) has put it down as one of the big-ticket items that has to be considered given the financial state of the country.
	We need to develop a clearer picture of what is happening in the proliferation states and those that possess, or seek to possess, nuclear weapons. We need to try to reinvigorate the process of multilateral disarmament, but we will have to make a decision soon—in the next two, three or four years. The report offers an excellent opportunity to go over many of the aspects of it.
	Finally in the section that we might call "defence" comes the 20th report on the major projects—the 20 biggest MOD projects that have suffered an increase in costs of some £205 million and delays totalling some eight years. By any measure, that is very significant. We all know that defence projects tend to go over budget and to take longer—we have discussed how that happens in defence debates—but at a time when we are looking for significant savings over all aspects of Government expenditure, perhaps we need to redesign how the procurement process is undertaken. The report makes some useful comments and suggestions about how that might be done.

Colin Breed: I am only too aware of that. Even in my constituency, the very small firms that can be light on their feet, which are often set up by people who come out of the military to set up their business on retirement—experienced technicians with enormous experience and the qualifications to undertake some of this work—find it difficult to engage with the large firms on the contracts. One way in which procurement can be speeded up and quite a lot of money can be saved is if the small and medium-sized enterprises are much more engaged in the process, perhaps through some sort of contractual arrangement. I entirely agree with the hon. Gentleman.
	The strategy may be a bit outdated, having been written more than 10 years ago. We know that there is to be a strategic defence review, but many of the earlier assumptions have been undermined by our experiences in Iraq and Afghanistan. The fact that our enemies can move around much more swiftly and expose weaknesses in our defences means that we need to review our urgent operational requirements much more often. As the PAC report pointed out, future contracts need to be much more flexible and adaptable so that we can be much lighter on our feet. The key question is how that recommendation can be taken into account, as this has always been an extremely difficult and perennial problem, going back decades if not longer.
	The Committee Chairman mentioned the report into the oversight of the CDC group by the Department for International Development. The matter had been brought to hon. Members' attention somewhat before the report was begun, although I suspect that the fact that everyone had so much on their plates meant that not many got around to looking at it. I was extremely pleased with the report, and mention has been made of matters such as the chief executive's salary and so on, but what stands out for me is the fact that CDC is not doing what it was set up to do.
	We need to revisit how CDC operates. Of course it is important that it makes a profit, but that is a heck of a lot easier to do if it deals only with certain markets and businesses. Enhanced performance may lead to larger bonuses—who knows?—but the assumption was that CDC would work in smaller markets, with more difficult companies and in the more difficult areas of the world, because that was where there would be a crying need for support. It appears that DFID has taken its eye off the ball, so it needs to go back and make sure that CDC does what we believe that it should. That may make the sort of profitability that CDC has achieved a heck of a lot harder, but the organisation was not set up to make easy profits in easy markets. That is not what Parliament or the country want: we want it to go into the more difficult areas of the world and help developing countries to get their indigenous businesses going. In that way, they can become more successful economically and less in need of aid and assistance as a result.
	The report contains some excellent stuff. I know that it has probably been alighted upon because the media are very interested in matters such as the salaries of chief executives, but it put a spotlight on the operation of CDC and showed that it was not really doing what we wanted it to do.
	I turn now to the letting of rail franchises. I use the train to and from Cornwall every week and am only too well aware of the performance of the rail franchises, especially First Great Western. The company's acronym is often expanded in a rather derogatory way but—I do not know whether this has anything to do with the PAC—there has been a lot of improvement even though there is still a long way to go. However, there are many matters on which it has been difficult to shine a spotlight. In my part of the world, for instance, FGW's intention to raise car parking charges did not exactly encourage people to use trains.
	Another problem has to do with the massively complex and expensive fare structures. A fortnight or so ago, I bought a ticket at Paddington using my senior rail card. I was given a ticket for £40, and I said, "No, you must've got this wrong." The person in the ticket office replied, "No, this is a special deal for people over 55. We assumed that you must be over that age because you've got a senior rail card." I asked whether it was a return, and was told that it was. It is astonishing that one can get a return all the way to Cornwall for only £40. I was not aware that it was possible—although I suppose the offer had been marketed—because the normal cost is around £200. The fare structure is so extraordinarily complex and expensive that it must be beyond most people.
	The problem is that the train companies are competing against internal flights. I suppose that some people might see it as unfortunate, but it is cheaper to get a flight from Plymouth to London City airport than it is to travel by train. The flight takes an hour and half, but the train takes three and a half hours, plus half an hour on all the other bits and pieces. We are trying to promote rail use, but it is cheaper to travel by air.
	Then we have the overcrowding problem. Some people thought that that was a planned strategy—that if there was lots of overcrowding, the company could stick the price up and thereby both adjust its profitability and decrease the overcrowding. The whole question of rail franchising will come back again—at least I hope it will. Although there has been reasonable improvement recently, there is still a lot to be done. If we want public transport that is inexpensive and easy for people to use, so that we can meet our emissions targets and so on, we will have to look more closely at how rail franchises are operating and whether the companies are doing what they said they would do.
	As a member of the Treasury Committee, it was inevitable that I would want to discuss the PAC's 31st report, on the nationalisation of Northern Rock. The Treasury Committee reported on that as well, of course, and I think our reports complemented the PAC report well. I have never taken the view that the Northern Rock affair was necessarily a forerunner of the disaster that we have seen unfold since. Northern Rock was not, in the jargon, a casino bank; unfortunately, however, it had access to the casino and it was that access that greatly assisted its downfall. Very early on, the FSA, if not the Bank of England, identified Northern Rock as one of the legendary outriders, operating way beyond the general mass of its competitors and going far out on a limb. However, had that bank undertaken some de-leveraging and sorted out some of its wholesale contracts and so on, I think it would have had a fighting chance of avoiding failure and subsequent nationalisation.
	I wish to examine the idea of success and the direction in which we are to go now. The PAC report comments that
	"Goldman Sachs commenced work as the Treasury's financial adviser in September 2007".
	It has been interesting to see reports of Goldman Sachs's current profitability and the bonuses it is paying—no doubt, it secured a decent fee for its work for the Treasury. It is also interesting to read that the agreement between the Treasury and Goldman Sachs, which
	"included a monthly retainer plus a success fee",
	was not reached until some time after Goldman Sachs commenced its work, but that "success was not defined." I am not certain whether success is defined now or what Goldman Sachs is likely to receive by way of a success fee. Nationalisation is one thing, but if the public are to get some success out of Northern Rock, some hard work needs to be done. It is not just a matter of paying Goldman Sachs some sort of success fee, based, no doubt, on its view of what constitutes success.
	Some work has recently been done on the potential for restoring Northern Rock as a mutual—dividing it into a good bank and a bad bank, with the bad bank being managed out by UK Financial Investments and the good bank being put back into the market as a mutual, perhaps to encourage revitalisation of the mutual sector. Some good work has been done on that, particularly by the Building Societies Association. I hope that the Treasury, the Public Accounts Committee, or both will consider the possibility that value for money for the public may be gained from more than the financial repayment of the support Northern Rock was given. If Northern Rock was returned to the market as a mutual, it could be a catalyst for the revitalisation and expansion of the marketplace for financial companies—banks and mutuals. Our aim could be not only to get Northern Rock back into the market and to get back some of our money, but to use it as a means of kick-starting a renaissance in the mutual sector. I hope that the PAC, the Treasury or both will look at that in the not-too-distant future.
	Finally, I thank the members of the Committee for all their hard work. I think that it is about the oldest Committee, and it is clearly one that should be given all the support and resources that it needs. After the next election and over the next few years, saving money, as opposed to just spending less, will be an extremely important component of any Administration. Whoever serves on the Committee, they will be providing a valuable service to this country and to the enormous number of people who feel very let down in many ways. If they begin to see that Parliament is on their side in saving their money and improving their services, that will do a great deal more to restore the reputation of this House.

Austin Mitchell: We can assume that this will be the final debate about the reports and activities of the Public Accounts Committee before the election, which will probably be on 6 May next year, I understand. Before people rush from the Chamber to make a note of the date in their diaries, I should say that it is not infallible. I hope that this will not be the last debate, however, because we will continue to work for up to six months until the election and there will be matters to report on during that period. We need to keep up the pressure on government to improve performance which these six-monthly debates give us. This is our one voice that is heard more widely than our mere Committee hearings and reports, and we should use it to the maximum.
	As befits a deferential member of the Committee, I agree absolutely with our Chairman, the hon. Member for Gainsborough (Mr. Leigh). He gave a commanding overview of what we have reported, and he pointed out the serious savings that, based on our reports, can and should be made. The Committee has identified a number of failures that if rectified would produce serious money that could be used for other things which, if implemented, as I hope they will be, would provide better government and a more efficient public service. We need to keep up the pressure, rather than say that we will abandon it now to go into the wild fields of electioneering, with all the media exaggeration of what can and cannot be saved. Today I am perfectly happy to echo the hon. Gentleman, and to take time out of my own campaign to retain Great Grimsby as a Labour seat to back him and the Committee's efforts.
	Being a member of a Select Committee is generally one of the few delights of a Back Bencher's somewhat dreary and pressured existence, but being a member of the Public Accounts Committee, which as the hon. Member for South-East Cornwall (Mr. Breed) said is the oldest—and certainly the best—Committee, is the best part of the job. It has been a sheer pleasure to be on the Committee and see so much of the inner workings and possible failures of government, so I congratulate the Chairman on his chairing of the Committee and his summary today of our performance. With that grovelling servility, I shall move on to my own remarks.
	These debates are a chance to establish an overview of the Committee and the failures in government that it points up. At the Public Accounts Commission the day before yesterday, I was delighted to hear that that is also the intention of the new Comptroller and Auditor General. He wants to develop a system for bringing out the common patterns of failures and weaknesses in the public services. I hope that that will ultimately produce a manual of mistakes that have been made, which will be an invaluable practical teaching guide, particularly for the training of civil servants. It will also be valuable to us, as a Committee, in letting us know what to look for in terms of the common patterns of failure and chief weaknesses. That will put our debate on a very practical level as opposed to the emotive comment and populist onslaught from the media, who take minor failures, exaggerate them as if they were general practice and then denounce the entire machine—the civil service and Government Departments—for failing to take account of them.
	That emotive level of debate is not an appropriate one for us: our job is to find the common patterns of failure and to eliminate them. That will become even more necessary as the recession increases the importance of Government intervention. From my point of view politically, the problem is not big government, as the Leader of Opposition has identified it—it is not about the scale of government but about the efficiency of government. Bigger government is inevitable as the only way of coping with a recession and economic difficulties. Our job, as a Committee, is not to argue about the scale of government but to make it more efficient and to see that it functions economically and effectively to serve the purposes of the public. We are not part of the populist argument, but we are an invaluable tool. The real need is not for bigger or smaller government but for efficient government and an efficient public service, which will itself be more economical, as our Chairman said, and save an enormous amount of money for the wider purposes of government, giving more satisfaction to the people.
	I want to concentrate on the pattern of common failures and weaknesses in government that are responsible for a lot of the opprobrium in which Government Departments can be held. I am interested in the notion of the continuous grinding away of efficiency savings year by year whereby we can count on a certain amount for, say, this year. That is often responsible for fairly disastrous failures.
	At the Rural Payments Agency, for instance, the efficiency savings led to the firing of public servants and a diminution of the role of the RPA just as it hit the crisis of rural payments and the common agricultural policy, and it had to re-employ people to do the job and provide the knowledge that the fired civil servants had provided. That is not efficiency, but gross incompetence. This is not just about relying on a grinding process of efficiency savings—we need an invigilation of the processes to ensure that they are effective instead of imposing a general restraint on them.
	Let me give my view of the common problems. First, there is the propensity to spend huge sums on consultancy payments, largely to the big accountancy houses, which under this Government have grown fat on enormous contracts. Admittedly, I slightly exaggerated in our last debate when I gave the figure in billions rather than millions of pounds; I do not suppose that it is possible retrospectively, at a six-month remove, to correct  Hansard. However, whether it is millions or billions, these sums are still huge and unjustifiable. It is an abdication of responsibility by Ministers, who formulate a policy and get it sanctioned by a consultancy report without giving the civil service—the senior civil service, in particular—its normal role in policy formulation, which is to encourage, to advise and to warn. It becomes a coalition of Ministers and consultants who justify the policy on the basis of consultancy reports and then use them to argue in its favour. However, those consultancy reports are often ineffective and they are all an expensive way of anointing and sanctifying particular projects.
	Many of the reports have been inadequate—we heard of an example in our hearings just this Monday as part of our inquiry into Metronet. Tens of millions of pounds were spent with Freshfields, PricewaterhouseCoopers and other big consultancy houses for auditing the contracts, giving advice on them and ensuring that they were okay. At the end of it all, despite all the advice and what it cost, the contract with Metronet effectively bombed. It was not valid or effective. It did not provide the Department for Transport with a means of controlling output or performance, or really with any role in performance at all. It was partly responsible for the failure of the Metronet project and the fact that the Government had to pay £1.7 billion in the four years before that failure. That should have been the sum of the payments over the full life of the contract. It was a big expenditure of public money—more than £400 million effectively wasted —because of inadequate corporate governance and oversight, and because the contract itself was not an effective way of maintaining control.
	That is the situation all too often. We get advice from consultants, who are not then held accountable for the failure that they should have anticipated. There needs to be more effective oversight, and not just by the Committee, because our oversight is posthumous. The money is gone by the time we come to deal with it. We try to close stable doors after horses have bolted at enormous expense. Oversight should perhaps be provided by the Office of Government Commerce, which needs a stronger and more effective role than that of an advice service or the toehold of accountancy houses in Government so that they can push their case for contracts. It should have an audit and control role over those contracts, and it should ensure that performance is adequate. If it is not, it should demand sanctions and penalties.
	The same is true of IT contracts. All too often, Departments seem incapable of dealing with the wily stratagems and sales patter of consultancy salesmen, particularly from the big houses, who offer expertise, but over-praise the product in question and forecast that it can do more than it actually can. Departments, in turn, try to set too many objectives to be accomplished, which always leads to failure in IT contracts. When we try to do more with an IT system than it can bear, it inevitably breaks down and performs inadequately. There is failure on both sides, on the part of the Department and the salespeople.
	We see that problem in various reports before us. Implementation of the defence information infrastructure programme is running 18 months late. We recommend that the Ministry of Defence should ask its contractor ATLAS to monitor and report regularly on the health of legacy systems and develop contingency plans for each system, funded by the management fee that it receives. That is an explicit criticism, but it is too late. The matter should have been overseen by the OGC and the MOD itself when the contract was agreed.
	The hon. Member for South Norfolk (Mr. Bacon) will no doubt wax eloquent about the NHS national programme for IT, as he has so often in the past. Here is a contract, however, that is so curious that it is inexplicable to me. Our report showed that the care records service is at least four years behind schedule. Of the original four local service providers—the main suppliers responsible for implementing systems at local level—only two remain. The others have dropped out.
	The Government have found that while they can direct NHS trusts and primary care trusts to take the systems, they have no such power over foundation trusts, even though the system would generate substantial benefits for patients. Therefore, foundation trusts have not participated, which pulls the plug, in my view, on the whole system. That is another example of a contract that was not adequately thought through or adequately audited right at the start.
	The Government were trying to do too much with the systems, which were over-sold. Departments need better advice to put them on a more secure and effective platform for controlling the suppliers of IT systems they deal with. As the Chairman said, no taxpayer pound should be the source of easy profit. That is an absolute maxim. However, in consultancy and IT services, the taxpayer pound has been a source of far-too-easy profits. We need to control that, exact penalties where necessary and blacklist firms that are over-selling in that fashion to see that they do not make the same profits and mistakes in future.
	The third common factor that we point out and which I derived from the reports we are dealing with today is that the Government do not think through their purposes or the difficulties of achieving their objectives clearly enough. Because they are an idealistic Government, and because my party is idealistic, they are a Government of impulsive gestures—"We will do so and so!" The gestures come from the heart, which is okay—most of my gestures come from the heart; it is just that I am less competent than I assume the Government to be—but the consequences of implementation are not thought through. If projects fail, it increases public alienation and cynicism about the Government's purposes and objectives.
	Our report on the letting of rail franchises by the Department for Transport includes another example. One would have thought that that was a fairly straightforward technical and financial matter, but our report shows that promises, with Government concurrence,
	"of bringing 1,300 new rail carriages into service by 2014"—
	we should do that because of the overcrowding and pressures, particularly on London commuter services but also on the east coast main line, which I use—
	"look over-optimistic",
	which they are. We promised 1,300 new rail carriages by 2014, but, as the report continues:
	"There are only 423 on order so far, and another 150 carriages are the subject of negotiations. It takes 30 to 36 months to mobilise the supply chain",
	so there is no prospect of that happening. It just was not thought through. We issue the promise—rightly, because it becomes something that we want to achieve—but we do not take account of the practical considerations in delivering it.
	There are more examples of things that have not been thought through in our "Widening Participation in Higher Education" report, the result being:
	"The Department..."
	has not developed
	"a single source of information to enable potential students to identify easily the bursaries and grants for which they may be eligible."
	If participation is to be widened, that is a fundamental, straightforward requirement, but it was not done. Guidance to young people on how to access higher education is a variable quantity. The Department and its partners should develop guidance on the financial support available. Again, we will the end, but do not define the means. It is another failure to think things through.
	The same problem is seen in improving adult literacy. We proclaim the intention, but we do not use the practical means of fulfilling it, such as educating people in prison. The same is true when it comes to energy use reduction. There is a confusingly wide range of energy saving advice. In that case, we will the end but provide too many means, none of which make enough of an impact to achieve the objective. That is the third common pattern of weakness.
	I also include tax credits, which have been the subject of a long series of considerations by the Committee and the NAO. Tax credits were well intentioned. It was right to put money in the pockets of less well-off working people and pay it to them directly through the tax system. But because of the excessively strict rules on which the Treasury insisted, the system was inflexible. The earnings of people who are in and out of work fluctuate wildly, and the result is overpayments or underpayments, and poor families end up facing demands for enormous sums that they cannot possibly pay back in the time allowed.

Austin Mitchell: I agree with the hon. Gentleman. The tax credit system has been combined with the dreaded efficiency savings, which have led to the closure of offices in Manchester and Bristol, and the concentration of services in Birmingham. Grimsby has lost the ability to conduct face-to-face meetings. The CSA is another case in point. It tried to provide face-to-face meetings through regional facilities, which quickly failed. A particular problem with the tax credits is that MPs have a hotline, and direct access, but the public do not. People want the system to be explained to them, so what they can apply for is explained to them and what they cannot apply for is justified. That cannot be combined with efficiency savings that reduce the staffing levels of HMRC offices up and down the country.
	The same problem happens with jobseeker's allowance. People want face-to-face advice, but increasingly they have to obtain advice through the internet or on the telephone. That is not an adequate approach to dealing with a sector of society that does not have the greatest understanding of the system—I do not, and they certainly do not—and how to work it. In all these instances, the failure to think through how to implement the Government's good intentions more effectively is a major weakness.
	The Chairman dealt with the issue of defence procurement effectively, and we have had effective control over that area. The major problem in that respect is that we have entered into commitments in Afghanistan and Iraq—in my view, we should not have entered into them—without the means to fulfil them. The result has been an enormous increase in spending, including last-minute increases, and unsatisfactory performance.
	The basic problem is that we are trying to fight a war that is over—the cold war—with weapons of high-technology, aircraft carriers that need frigates mustered all around to protect them and nuclear submarines. Those are weapons from a cold war era that is over. We now face continuous bushfire wars scattered around the globe, for which we need not high-technology equipment, but simple, straightforward and reliable equipment and a power to intervene rapidly.
	I shall not go into that further—I just wanted to mention it—but it is part of the weakness of failure to think through what we are doing. I am not criticising the Government's good intentions—as I said, I, myself, am overflowing with them—but I am questioning their practicability and the Government's failure to think through the problems.
	Another of our difficulties is that we are deal with everything posthumously. We are trying to close the stable doors after the horse has bolted; we are dealing not with the people who caused the problem, but with their successors, who naturally come along, profess every good intention and promise that it will not happen again. They go away and, in the main, implement our reports, but if we cannot get the perpetrators, it is a very unsatisfactory way to proceed. We got them once on an issue concerning the Rural Payments Agency, and it was very illuminating, but we did that only after exceptional effort. It should be part of our routine that we are able to speak to the people directly responsible for the problems.
	We need a power to ensure that our recommendations are implemented—in other words, we should be able to audit them after a year to see whether they have been implemented. We also need wider access to bodies. As the Chairman of the Committee said, it is ludicrous that we cannot cover a major spender such as the BBC, which would be less criticised for being over-grandiose and imperialistic in its ambitions to run everything if it gave the assurance that it would be effectively audited by the Committee and the NAO. That would guarantee that BBC spending was efficient, effective and welcome.
	I think also of the Financial Services Authority, the Bank of England and the civil list. I do not particularly want to remove the glitter that surrounds the civil list—I have lost my earlier enthusiasm there—but Buckingham palace, in its attempt to explain to us exactly what was involved in the maintenance and repairs at the palace, missed a good opportunity: we were invited along, but not given any food, which did not produce the best and most welcoming mood. I did not go for that very reason. If we were not to be fed, I did not want to know, although perhaps that was selfish on my part. As an ambitious over-eater, going to the palace would have satisfied my social-climbing ambitions, but not my culinary ambitions. We should certainly cover the civil list, but I say that with no great enthusiasm.
	The Committee also needs a bigger staff. The NAO has a big staff; its work is welcome and important, and its staff are very good—I am constantly impressed with them. However, we need a Committee staff to fill in the gaps between the NAO reports and our inquiries. Those are often media gaps: what has the debate centred on since the NAO reported, which quite often happens a few months before we deal with a given matter? What is the measure of public opinion? What have the media been saying about the issue? What has  Private Eye—often a valuable source of information—been saying? What has happened in the Departments concerned since the report? Addressing those issues would allow us to make more effective and trenchant inquiries.
	However, with those reservations—and, I am afraid, a somewhat excessive contribution, justifying my desertion of Grimsby's needs to be here tonight—let me say that, for me, this has been six months of real pleasure, interest and effort, in one of the best jobs on the best Committee serving the House.

Richard Bacon: I am sure that we are all equally horrified by the fact that the hon. Member for Great Grimsby (Mr. Mitchell) has finally brought his remarks to a conclusion. I thought that he was just getting into his stride, but alas, we shall have to wait until next time.
	It is a great pleasure to take part in this debate and a particular pleasure to see the Exchequer Secretary in her place, because she was for some time a doughty member of our Committee, bringing an expertise in defence. I remember being in the Pentagon with her on a Committee visit when we were all jaws agape at her penetrating analysis of world defence problems. I only hope that she brings the same penetrating glare to public expenditure from inside the Treasury and applies what Sir John Bourn described as a necessary maxim in defence procurement generally: namely, that we should have rather less infanticide and rather more contraception.
	I will be relatively brief and concentrate on two issues, one general and one specific—the National Audit Office and its strategy, and one of our reports, about the national programme for IT in the health service. The hon. Gentleman was right that there is nothing that I like better than wallowing in the interstices of the national programme for IT. I am delighted to say that on this occasion I can do so within the terms of the motion, because one of the reports that we are focusing on is about that subject.
	However, I would like first to say a quick word about the Comptroller and Auditor General, whom we were pleased to see in his post and giving evidence recently about the NAO strategy. He said something in the new strategy that I thought was particularly interesting. It is quite obvious that his beady eye has been caught by the fact that permanent secretaries have to sign statements of internal control. That sounds pretty anorakish—perhaps because it is—but it is important, because it means that permanent secretaries have to write, in their own blood, that they have no reason to believe that their control systems are not up to the job in hand of controlling the resources of their Department.
	Depending on how the NAO treats it, that is potentially a serious thing for permanent secretaries to be saying, and it is clear that the new Comptroller and Auditor General intends to hold them to their word. Indeed, in its new strategy, which runs from 2010-11 to 2012-13, the NAO has been quite explicit:
	"public bodies need to be confident that the resources for which they are responsible are appropriately managed and controlled."
	The strategy continues:
	"We intend to strengthen the work we do on statements of internal control to ensure that they are supported by robust evidence that controls are sufficiently reliable."
	Amen to that, although some may wonder why that has not been happening hitherto. Some people may say that it has been happening, at least in outline or process form, but it has plainly not been happening to a sufficiently strong degree.
	The central issue is how people in Whitehall are promoted and end up running Departments. Indeed, Mr. Amyas Morse, the Comptroller and Auditor General, made that point in evidence to the Public Accounts Commission just the other day when he said that the NAO is to set out some thought leadership on the elements
	"in a basic management culture that you'd expect to see if you're going to be able to drive and control resources effectively."
	He continued:
	"I do think you can't assume in the public sector that's an inherent management culture of the kind that you find in the private sector because people don't spend their whole lives in the public sector trying to improve profitability. They would say to you, 'That's not my first role'."
	He added:
	"So the ideal skill set for the civil servant isn't one primarily focused on being able to control resources very tightly against particular objectives."
	In fairness, he also pointed out that
	"the organisations were created with different ends in mind so trying to champion that in the public sector is something that we need to work at".
	It has already been pointed out that, in the present financial climate, the capacity to control resources very tightly against particular objectives is going to be an essential feature of successful management in the public sector in the years ahead.
	That brings me neatly to the national programme for information technology in the health service. That was the subject of our second report, which was published on 27 January 2009. Members will know that the programme is now expected to cost £12.7 billion, although the original figure that was floated was £2.3 billion. It went up to £6.2 billion, then it became £12.4 billion, and now it is £12.7 billion. In a nutshell, the central problem is that, in the entire period since its inception, no serious public work has been done to compare what is to be delivered by the programme with the original output-based specification in the contract—not least because the contracts are all secret and we cannot see what they say. If such a comparison were to be done, it would show an enormous gap between the two. It was only the extremely high ambition of the output-based specification that justified the enormous cost of the programme in the first place.
	Over the years, the programme has been steadily de-scoped further and further—in many cases, behind the backs of NHS managers—so that, one day, the providers will be able to say, "Look, we've delivered, and it's a success. We've achieved our objective." It will not be the original objective, however. These actions make it extremely difficult to compare the outcomes with the original objective, but some of us remember that objective.
	The Treasury minute that responded to our Committee's report is liberally sprinkled with the sentence
	"The Department accepts this recommendation."
	That is very welcome news. I want to turn in particular to PAC conclusion 6, which I shall quote briefly for the record. The Committee stated that
	"the Programme is not providing value for money at present because there have been few successful deployments of the Millennium system"—
	a software system provided by a company called Cerner—
	"and none of Lorenzo"—
	another software system, from a company called iSoft—
	"in any Acute Trust. Trusts cannot be expected to take on the burden of deploying care records systems that do not work effectively."
	That is good news. The Committee's conclusion continued:
	"Unless the position on care records system deployments improves appreciably in the very near future (ie within the next six months), the Department should assess the financial case for allowing Trusts to put forward applications for central funding for alternative systems compatible with the objectives of the Programme."
	I want to take a moment to look at some of the Treasury's responses to those points. The Department's response No. 17, on page 11 of the minute, states:
	"Although the Department does not agree the six-month timetable, it does agree that the position on the deployment of care records systems needs to improve appreciably over the coming months".
	I do not think that anyone would disagree with that. Indeed, the Exchequer Secretary's predecessor did not disagree with it, when she wrote to me on 14 November 2007, following a debate on the work of the Committee on 23 October 2007, in which I raised concerns about the Lorenzo system and said that I was worried that the statement in the Treasury minute that Lorenzo would be available by the end of 2008 was incorrect.
	The hon. Member for Wallasey (Angela Eagle) was Exchequer Secretary to the Treasury at that time, and she replied that it would indeed be okay in the end, because Lorenzo was going to be deployed around what were called early adopter sites in the summer of 2008. She went on to say that
	"early adopters will get access to the first release next spring"—
	that is, spring 2008—
	"and the second release later in the year, prior to their being made more generally available three months later."
	The fact is that there has not been a single deployment of Lorenzo in 2009, and there has not even been a plan to have a single deployment of it. The reason is that the handful of deployments attempted have been an absolute mess, causing chaos in the hospitals where they were tried. That brings me back to the Treasury's conclusion in response No. 15, where it says that it
	"does not accept that the Programme is not providing value for money at present."
	I tabled a question yesterday about the number of hospital trusts where Lorenzo has been partially deployed, asking how many users—how many concurrent users—of Lorenzo there are. I look forward to the answer, but the Exchequer Secretary will not need to consult the written answer that has not yet been written to know that the answer is not very many. It is literally just a handful, which means that the cost per user is not what one would expect. Deploying a software system in an acute hospital with 3,000 to 4,000 workers, one might expect that the cost per user would be a few hundred pounds per user per year, but the cost is going to be many hundreds of thousands—possibly even more than a million—pounds per user per year. How that is consistent with conclusion No. 15—with the Treasury saying that it does not accept that the programme fails to provide value for money—I simply do not understand.
	It is not just that Lorenzo is not working. The other system produced by the other main company involved—the Cerner Millennium system—has also caused absolute havoc where it has been deployed. Barts hospital has been forced more or less to its knees because of the Cerner Millennium system. Back in March this year, it suspended its 18-week reporting—one of its obligations, saying it expected to resume them in September. It did not do so, and by the beginning of this October it had a backlog of 23,000 breaches.
	We could talk about missing targets, but what really matters is that patients are being kept waiting longer than they should—in some cases, for longer than six months—because the hospital is unable to manage its information as a result of struggling with that dreadful system. As a consequence—it gets worse—the hospital is to be fined £400,000 a month by its primary care trust, NHS Tower Hamlets. This hospital already has a deficit of £6.7 million. That is no reflection on the clinical work done at Barts hospital, some of which is absolutely outstanding—world class, with no question about it. Yet having a system that does not work properly foisted on them is hampering its ability to continue to be a world-class hospital.
	I am afraid that it gets still worse. Under the terms of the contract that the NHS has signed with the local service provider, BT, to deploy Cerner Millennium in the south of England, if the NHS fails to deliver four new greenfield sites that are ready and willing to take the Cerner Millennium product, it will be liable to pay BT £44 million. If all goes well, the Department of Health will pay £73 million to BT for installing Cerner Millennium in four hospital trusts in the south, but not if those trusts baulked at taking the software—they would, of course, be quite right to do so because it does not work. What is more, the Treasury tells them that they do not have to take it, as note No. 16 of the Treasury minutes states:
	"Trusts will not be expected to take the systems until they work effectively".
	Thank you, Treasury—and quite right, too! That means that if the trusts cannot be persuaded to take the systems because they do not work—they will not, of course, if they do not work—the taxpayer will have to pay BT 60 per cent. of that £73 million for not taking them.
	By the way, this is not as a result of one of the old contracts; it is a result of a contract signed quite recently. Let me quote from a piece in  e Health Insider of 1 October:
	"The liabilities date not from the beginning of the National Programme in the NHS but are set in a contract signed just three months ago".
	There are still some very serious problems with the national programme for IT in the health service.

Richard Bacon: I am afraid that the answer is extremely hard to find. The Government will say that value for money has been obtained precisely because the original contract required that suppliers were not to be paid until they had delivered, but the position is not quite as simple as that. In some instances suppliers have been paid by the back door in respect of other programmes, and it is therefore difficult to see where they have made money and where they have lost it. I have little doubt that suppliers have lost a lot of money, but I would much rather see them offer the NHS something that it wants and be paid a reasonable profit in return than see patients kept waiting, hospital waiting lists in a complete mess, and hospitals unable to tell whether they have sent cancer patients messages with the results of their oncology tests. I would much rather see something that actually worked and produced value for money.
	Our recommendation 6 states:
	"Unless the position on care records system deployments improves appreciably in the very near future",
	the Department of Health should allow hospital trusts to seek central funding. We think that rather than funds going to local service providers that have not delivered, trusts should be able to look to the Department for those same funds, in order to spend them on systems that they actually want and which stand a chance of delivering something. That is the way in which to achieve value for money.
	We have already lost a great deal that we are not going to get back. What I want to hear from the Exchequer Secretary is how she thinks we can start making some sense of this mess, and how she thinks we can start receiving sensible answers to some of the questions that a number of us have been asking for a very long time.

Greg Hands: This is the second of these debates to which I have responded on behalf of the Opposition. In my parliamentary experience at least, they remain unique in respect of the multiplicity of subjects covered. In some contexts breadth is an indicator of superficiality, but the reports that we are considering today provide ample evidence of the forensic abilities of the Public Accounts Committee, and I am delighted that we have heard from a few of its members this afternoon.
	We were, of course, treated to a masterly opening summary from the Committee's Chairman, my hon. Friend the Member for Gainsborough (Mr. Leigh). It is a great sadness and a great pity that this may be the last debate of this nature to take place under his chairmanship. I have seen in his office on the second floor of this building the photographs and engravings of his predecessors, and I am sure that his own portrait will be a worthy addition to that collection. It may even end up having pride of place, given his work over the past eight years.
	I shall talk in due course about the importance of my hon. Friend's contribution and that of his Committee in the current context of a record public sector borrowing requirement and a record deficit, but let me say first that, during his eight years in charge, my hon. Friend has done a brilliant job. One of my regrets is that I do not expect to have served under his chairmanship. He says that he has secured £4 billion in savings, which is indeed a proud record, but he does not want to rest on his laurels; he wants to do more. If he is able to find a further £4 billion in savings, perhaps over the next six months, we should all be extremely grateful. I had been going to say that it would be even better if he could find £175 billion in savings, but in fact he helpfully told us where further large-scale savings to the tune of £9 billion might be found. I am sure that my colleagues in the shadow Treasury team will examine that in some detail in the coming months.
	While giving the details of where savings could be made, my hon. Friend also attacked increases in Government spending in many areas. One of the more remarkable facts is that at the same time as the rapid increase in public borrowing, there has been a 4.8 per cent. increase in Government spending over the year to September. That is, of course, far above the rate of inflation.
	I commend the Chairman for his years in charge. I am sure that he will maintain his close scrutiny of public spending after the election in whatever role he takes on—although I for one hope that we may squeeze in one more public accounts debate if the Government decide to delay the election until May or even beyond.
	The hon. Member for South-East Cornwall (Mr. Breed) highlighted two or three important reports, including one on the appalling blunders on the Chinook project, about which I will talk as well. I was a little more surprised by his words on Trident. If I understood him correctly, he was praising the good work at Devonport dockyards and the boost to the local economy in Devon and Cornwall as a result of Trident. But he then went on to tell us that he was not in favour of renewing the project. I am not sure how that will go down in that part of the country.
	The hon. Gentleman was on much safer ground when he referred to CDC and its failings, which I will also mention. One of the other reports that he mentioned— I was not going to look at this one—was on the letting of the rail franchises, a fascinating topic. Generally I am a strong supporter of privatised rail. I have used trains in the hon. Gentleman's constituency quite a lot. He knows that I was brought up in Looe. The last time I took the Liskeard to Looe line was in 2007, when I thought that the quality of First Great Western rolling stock on that line left a lot to be desired. I hope that it has been renewed since.  [ Interruption. ] By the look on the hon. Gentleman's face, it would seem that, unfortunately, it has not. Nevertheless, it is still a delight to use the Looe valley line in his constituency.
	The hon. Member for Great Grimsby (Mr. Mitchell) was unique in being a Labour contributor to the debate. I agree that efficient government is essential but I must strongly disagree that big government is inevitable. Big government is by its nature inefficient.

Greg Hands: I see him shaking his head but I challenge him to find anywhere in the world that has gained efficiency by increasing the size of its government. However, I agree with him on the huge sums paid to consultancies and how undesirable that is. History will record that one of the defining characteristics of the new Labour Government over these past 12 years has been the extraordinary waste of money on consultancies.
	I am looking forward to seeing the Committee's report on Metronet—the report is not before us today—whose failure will have a direct impact on my constituents. I am glad that the hon. Member for Great Grimsby raised the issue today. He rightly focused on a number of MOD, education and other IT projects and, despite our vastly different political views, I think he spoke a great deal of common sense in terms of his desire to see better value for money in public spending, even though he and I might disagree on the precise size of the cake.
	My hon. Friend the Member for South Norfolk (Mr. Bacon) spoke with his customary forensic skills and fluency and outlined important changes—I will have to read his comments carefully—as to how the NAO will effect better financial controls in Government Departments, which sound like they are welcome. He also said some important words about the culture of the civil service and on working to change attitudes in the public sector in the present environment to focus more on efficiency; getting more for less, as the leader of my party put it.
	My hon. Friend then launched a devastating critique of the NHS IT contract and its moving goalposts in terms of objectives and what has been delivered in a project that will come to symbolise Government waste as whole over the past 12 years. His examination of the details of the failings and the Treasury's failure to get a grip, as well as the astonishing consequences for frontline NHS services, should be compulsory reading for all Treasury and Department of Health Ministers.
	I mentioned the apparent lack of enthusiasm of Labour and Liberal Democrat members for debating the Government's earlier motion on securing the recovery. I note that, in this debate, there has been no Liberal Democrat speaker from the Back Benches and only one Back-Bench Labour speaker; although the hon. Member for Great Grimsby can hardly be described normally as a pro-Government speaker. It is a great pity that in a full day to debate first the economy and then the public finances, there has been almost no contribution from Labour or the Liberal Democrats.
	Several themes have emerged today, but all against a common backdrop. No one in this Chamber can fail to be aware of the woeful state of the public finances. The deficit this year is projected to reach round about £175 billion; £14.8 billion was borrowed in September alone, the highest figure on record. September's borrowing brings net debt to a staggering £824.8 billion and means that debt as a percentage of GDP increased by 2.5 per cent. in just one month, to 59 percent using the Treasury's own figures. To put it another way, the Government are currently borrowing £500 million a day.
	To see the seriousness of the situation we are all faced with, we only have to open the inside back page of  The Economist and note that of the 42 countries in the magazine's tables, Britain has the worst budget deficit of all, currently estimated to be heading to about 14 per cent. of GDP. That is twice what it was coming out of the last two recessions. The work of the Committee becomes ever more relevant in such a context, and its reports will prove a valuable resource for the next Government, of whichever party.
	Value for taxpayers' money should, of course, always be a priority for those charged with its proper use, but it is a duty that the current Government neglected in a milder economic climate. Perhaps this was an unconscious effect of their verbal trick of labelling all spending as investment and regarding it as an automatic good irrespective of frameworks and controls, and sometimes irrespective of ends. Whatever the cause, there has certainly been a pattern of failure to ask the right questions or to draw the right lessons from mistakes, and the reports before us today provide further evidence to support this view.
	Collecting the stack of documents from the Vote Office, one ended up with a veritable armful of reading after a slightly hassled clerk had fished out each of the 27 reports—I think that is the right number. As many Members have suggested, the large number of reports presents a dilemma as they all contain insights into their objects of inquiry but it is impossible to comment on all of them. I will focus on some of the reports that particularly interested me, but I shall be as comprehensive as possible in the available time.
	A number of reports focused on defence. After both the roll call of those who died in the service of our country over the summer months and the general debate last week, the House has been particularly aware of defence matters since it returned from the recess. There are four reports on the Ministry of Defence before us. One has a particular bearing on the situation of our troops in Afghanistan, and all have some relevance in the debate over resources.
	The Chinook helicopter provides crucial heavy-lift capacity for the Army. It played a battlefield role in the Falklands war and has done so ever since. The current versions were ordered in 1995, in what the PAC described five years ago as one of the worst examples of equipment procurement it had ever seen. The latest report on the eight Chinook Mk 3 helicopters suggests the delays are abysmal "even"—that is the Committee's telling phrase—by the MOD's standards. The Committee says:
	"The absence of these helicopters has meant that British troops in Afghanistan have had to make do with fewer helicopters, make an increased number of dangerous journeys by road and, due to the specialist nature of the Mk3, rely on heavily modified Mk2 helicopters for use on high risk special operations."
	Further, the night enhancement package referred to at the end of the assessment is, as the Committee discovered, still regarded as a key safety risk by Joint Helicopter Command.
	It is shameful that our soldiers have died from roadside bombs when additional helicopter support might have prevented the need for some of the road journeys they undertook and that our troops continue to undertake as we speak. While the Government can, and do, point to other measures they have taken since, that cannot alter the fact that our forces would be safer were it not for a series of Whitehall blunders, many of which have been examined by the PAC.
	Even the abandonment of the "fix to field" project, a decision taken to accelerate additional lift capacity, led to a 70 per cent. increase in the costs of the successor reversion scheme. The Government dispute the Committee claim that this was due to inadequate analysis and lack of consultation with Boeing, but an impression of hurried misjudgement remains.
	The departmental response also seems reluctant to accept the MOD's tendency to over-modify what are intended to be off-the-shelf purchases, or the extent to which the pursuit of perfection on paper leads to defects, delays and cost overruns in practice. While they may sometimes be unavoidable, modifications of contracts run a high risk of undoing the advantages that off-the-shelf procurement can offer, and the attitude displayed is worrying. When our country is at war and lives are being sacrificed, it is damning to know that equipment shortages and deficiencies could have been avoided.
	Almost the only encouraging note in the entire Chinook report is the reported 20 per cent. increase in flying hours resulting from joint work with Boeing on maintenance procedures. Better use of our existing assets will be essential in Afghanistan and elsewhere. The capabilities review that my Front-Bench colleagues have outlined is just one aspect of the Conservative response to these problems.
	The other reports on the MOD indicate the scale of the challenges that may face it. The major projects report states:
	"In the last year, the 20 biggest projects suffered a further £205 million of cost increases, and 96 months additional slippage... Total slippage stands at over 40 years".
	Although we accept the uncertainties involving new technology, those statistics bear witness to endemic failures in project management in the Department. Projects are not mysterious entities, and basic causes of project failure are the same whether projects are defence-related or civil, public or private. Yet again and again in the pages of these reports we read about over-optimism and poor controls.
	The report on the defence information infrastructure system is a case in point. The project was 18 months late at the time of publication as a result of fundamental weaknesses in planning. This huge project is replacing separate systems ranging from those within Whitehall to the onboard systems on Royal Navy ships. The cost was last estimated at £7.1 billion, and some 150,000 terminals are involved, yet assumptions were made on the basis of "totally inadequate research", the timetable was too ambitious and no pilot was undertaken before rolling out the implementation. Like so many Government IT projects—I will discuss the NHS IT system shortly—this one has come unstuck, and is 18 months behind schedule. It should not be necessary for PAC reports to have to include among its recommendations such basic advice as the following:
	"Where accurate information is not available, assumptions should be prudent and cautious."
	It is extraordinary that a need was felt for such basic advice to be included in the report.
	Existing legacy systems are also known to be at risk of failing. Meanwhile, the Government's contractor, the ATLAS Consortium, has still to meet many of the original requirements. The capability to handle securely classified information and information held about personnel is in doubt. Perhaps the Minister could indicate what progress the Government have made on the continuing data security concerns. On major equipment procurement decisions, progress seems to have been ruled out. Ministers seem to be leaving all the difficult choices to a future Government. If their intimations of the future come to pass, our priority would be to introduce a much more rigorous and commercial approach. The Department must learn from complex civil programmes if it is to have any hope of completing projects on time and to budget. We believe that greater commercial discipline is the only way to deal with the management of vital and expensive military programmes, and it is essential that industry is brought into the process at an early stage.
	As my hon. Friend the Member for Gainsborough also outlined, there are more encouraging signs from the Ministry of Justice and the Office of Government Commerce in respect of regular procurement from within the Prison Service—we are very pleased by that—which achieved cash savings of £120 million in the 2007-08 period under review. The Committee claims its share in that success and with some justification, as was acknowledged by the witnesses in its evidence session. The critical 2003 PAC report was used as the starting point for the reforms, which are now being implemented across the MOJ.
	The use of online catalogues and procurement teams to make better use of the purchasing power of the service as a whole holds lessons beyond that one Department. The potential savings from allowing units within and across Departments access to each other's contracts are significant, and do not appear to have been driven forward by the Office of Government Commerce to the extent that they should. Prices and service levels negotiated by one become available to all, and low-volume purchasers benefit from the advantages of high-volume supply. That is an important way in which costs can be brought down—we will all have to pay more attention to this—in some cases dramatically, while also improving quality. The Department's response indicates that it offered to participate in OGC workshops and training events. On the basis of the Committee's evidence, I hope that that has happened.
	The OGC's record on contract management is the subject of another of today's PAC reports. As it records, central Government spend more than £12 billion annually on IT and other service contracts, and there are some basic concerns. Of those contracts, 56 per cent. had no associated contingency plan for supplier failure whereas 28 per cent. had no documented management plan at all. Worse, the report goes on to state:
	"Of the contract managers surveyed...25 per cent. of those responsible for contracts that had been running for at least three years had undertaken no value for money testing of ongoing services. And 41 per cent. of contract managers had not tested the value for money of new services."
	The OGC's responsibilities are secondary, as it is obviously the Departments that provide the management. However, it accepts a long list of areas for improvement.
	The oral evidence provided by the OGC's chief executive to the PAC at least seems to demonstrate understanding of what is required. As the Committee concluded, however, until Departments' behaviour changes, incidents such as the SATs testing fiasco are likely to recur.
	Let me move on to the national health service information technology fiasco. Perhaps the most prominent contractual and project failure of them all is the national programme for IT in the NHS, with total costs projected to reach nearly £13 billion, assuming full implementation is ever achieved. The Committee's summary, in my view, is surprisingly mild in the circumstances, although the facts speak for themselves. Most of the mistakes were made before 2006—before the period under scrutiny today—but there remains the question of whether the Government are throwing good money after bad. There are real doubts about the ongoing viability of the programme and one of the Committee's recommendations is to allow trusts to put forward applications for central funding to develop alternative systems.
	Incredibly, in rejecting that recommendation, the Department of Health stated that it does
	"not accept that the Programme is not providing value for money at present".
	That must be one of the most extraordinary admissions from a Government Department in relation to the PAC. The Department has never published a compelling cost-benefit analysis for its top-down imposition of a structure for which there was so little demand and for which the costs were always projected to be vast. It seems that the Government will remain in denial until the very last.
	The Opposition believe that integration should be pursued through local procurement that is open to national, open standards. Any action that we take if we are elected will depend on what we inherit, but we intend to halt and renegotiate the local service provider contracts to prevent further inefficiencies and to dismantle the central IT structure.

Richard Bacon: I was interested to hear what my hon. Friend said about renegotiation of contracts because one argument that is sometimes adduced—wholly falsely, in my view—is that there would be such huge penalties that it would not be possible for contracts to be renegotiated. Does he agree that since disputes with IT contractors never end up in court and since IT contractors want to work for government again in the future, there is almost always a way through that does not involve huge penalties on either side?

Greg Hands: My hon. Friend is absolutely right. The Government have, at their peril, underestimated their power in negotiating these contracts and ironing out details of them. In some cases, providers owe part of their existence to the Government, so the Government need to start punching their full weight in approaching this contract.
	Let me move on to the Department for International Development—I shall try to be a little briefer on this point. DFID needs some scrutiny, and I do not think that many speakers have focused on this report.
	In addressing the damage that the Government have wrought on the public finances, we have been clear that the NHS should not face budget reductions. However, that in no way removes the need for it to provide value for money. Given the increasing demands being placed on the NHS, efficiencies will also be essential. Similarly, although we gladly honour the UK's spending agreements on international development, the pattern of that spending and the associated standards of financial management must improve.
	The PAC report on DFID's operations in insecure environments highlights the need for change. I think that many hon. Members will agree that DFID's performance in conflict zones such as Iraq and Afghanistan needs urgent improvement. Its spending in such environments has increased to more than £1 billion, but project success scores in the same environments have fallen while expenditure has risen. It is true that one might expect success there to be lower than in secure states, but the deterioration should concern all of those who want us to succeed in places like Afghanistan.
	My hon. Friend the Member for Sutton Coldfield (Mr. Mitchell), the shadow Secretary of State for International Development, made a similar assessment when the PAC report was published. He said that
	"brave DFID staff work...in dangerous environments to improve people's lives, but their individual courage must be supported by radical policy and management improvements.—[ Official Report, 13 November 2008; Vol. 482, c. 1019.]
	I fully agree with that.
	It is important that the monitoring of projects for fraud and corruption is enhanced, as the risks of both are greatest in unstable countries, yet insecurity appears to have been used as a reason not to undertake full assessments of the expenditure made. Surely the potential for destabilisation demands the opposite approach—we should be more careful about expenditure in such environments.
	The PAC report on departmental oversight of the CDC group has been highlighted by a couple of other speakers. It reveals further failures to monitor and control public spending in an effective way, and that is especially true when it comes to the remuneration of senior staff. The strong financial performance of CDC notwithstanding, it cannot be right that the chief executive of a company that is wholly owned by the taxpayer received an increase in pay of nearly £600,000 in a space of just four years. It is extremely hard to justify total pay of around £1 million when one has complete job security and, despite the fact that the Department has tried to make comparisons with the private sector, when one does not have to compete for capital to invest. We have drawn attention to excessive pay in quangos, and this appears to be a parallel case.
	A number of the reports about education and skills were equally damning about many aspects of the Government's approach in recent times. In due course, we will all end up paying for the deficiencies in literacy and numeracy on the part of both children and adult learners. To the Government's credit, the departmental responses to the indictments in the PAC's reports on schools acknowledge that too few people possess the key skills. However, there is little indication of fresh plans to turn the situation around, and we can ill afford the current lack of progress to continue.
	In conclusion, we need to return to the question of the size of the deficit. As we know, the Government are currently borrowing around £500 million a day, and one has only to see the various reports from OECD and other bodies to grasp the seriousness of the situation.
	The deficit poses grave dangers to the country. Ours is the worst of any major nation, but the Government sometimes say we do not need to worry because, as a percentage of overall gross domestic product—as I said, it was at 59 per cent. but it is rising rapidly—is still below the level in other countries. For instance, in Japan it is 188 per cent., in Italy 116 per cent., in Germany 78 per cent., and in France 77 per cent. The Government remind us that our deficit is only marginally larger than that of the US, but a number of the countries in that list have very strong domestic savings markets that we unfortunately lack. The danger is that we could become overly dependent on foreign buyers of our gilts.
	I end by returning to the theme of the day. The need to make savings can never have been greater, as with the need for proper scrutiny of what is spent—hence the role of the PAC. I think that all hon. Members owe a debt of gratitude to the Committee and its Chairman, my hon. Friend the Member for Gainsborough. I look forward to hearing the Minister's response to a number of the points raised in the debate.

Sarah McCarthy-Fry: It is an enormous pleasure to respond to the debate on behalf of the Government. As the hon. Member for Gainsborough (Mr. Leigh) said and the hon. Member for South Norfolk (Mr. Bacon) mentioned, I have served as a member of the Public Accounts Committee under the chairmanship of the hon. Member for Gainsborough, and I congratulate him on the work he does. I am no stranger to public accounts debates, either: by looking back in  Hansard, I confirmed that I attended and spoke in the debates on 26 January 2006 and 18 July 2006; and, after leaving the PAC on becoming Parliamentary Private Secretary to my right hon. Friend the Member for Wentworth (John Healey), who was then a Treasury Minister, I attended the public accounts debate to which he responded.
	Serving on the Committee and seeing how ministerial decisions have been implemented gives one an insight that is really helpful when one takes up a ministerial post. We all know that Ministers make decisions in good faith—that was mentioned by my hon. Friend the Member for Great Grimsby (Mr. Mitchell)—but, of course, that is not the end of the story. If those decisions are not implemented effectively, it undermines both the policy and the Government's relationship with the people. That is why the Government have increasingly emphasised policy delivery—actually doing what we said we would do. Today's debate has again emphasised not only the wide-ranging nature of the Committee's work, but the fascinating insight it gives its members into the way Government works. As a former member of the Committee, I can attest to that.
	The Committee builds on a great, long and proud tradition of ensuring that public moneys are properly accounted for and provide value for money, and that the appropriate lessons can be learned when reports are produced. In these times when money is tight, as many speakers mentioned, it is even more important to ensure that we get the best value for money for every pound spent. That is where the Committee keeps Government up to the mark. I have just seen the letter from the hon. Member for Gainsborough to the Chancellor, which again illustrates the benefit that the Committee provides in terms of improving value for money.
	In his letter, the Chairman gives examples of how the Committee has helped Departments to achieve substantial savings and of where he thinks we can go further. All such suggestions are, of course, gratefully received. I do not want to match his list with a list of what the Government are already doing in each of the areas he highlights in his letter, nor do I wish to anticipate what we might say in our response to it, but I shall give a couple of examples. In financial management, where the hon. Gentleman highlights back-office costs, the Government have targeted savings of some £4 billion through standardisation and shared services; and in public sector procurement, we expect to achieve savings of some £7.7 billion through the operational efficiency programme. We all acknowledge that there is more to do, however. We shall examine with interest the specific examples in the hon. Gentleman's letter, and respond to his comments.

Sarah McCarthy-Fry: I am sure that that will be borne in mind when we are looking at the use of shared services. When considering how we can improve procurement, a one-size-fits-all process does not work. In discussions with one of the officials taking over procurement, it was made clear to me that, when looking at outside procurement, one sometimes has to take into account local factors that can deliver better value for money, rather than just look at the matter across the piece. That is certainly something that I take very seriously.
	We know that some 90 per cent. of Committee recommendations are accepted by Departments. That shows that the process of investigation by the National Audit Office, Committee hearings and Committee reports is useful. Departments improve as a direct result of the investigative process: for example, in its 13th report, the Committee acknowledged that the Department for Work and Pensions' handling of customer complaints' had significantly improved since the 2005 report by the Comptroller and Auditor General.
	Many reports are critical, but what is good about the Committee is that, even in a critical report, it gives credit where credit is due. It was therefore helpful that in its 18th report, which a couple of hon. Members have mentioned, the Committee acknowledged that the Commonwealth Development Corporation had performed well, outperforming the market while investing in poor countries, since the Department for International Development restructured it in 2004. The Committee acknowledged also that, since taking over from the Strategic Rail Authority, the Department for Transport had, in letting rail franchises, delivered to planned time scales and protected taxpayer interests.
	The Government's perspective on accountability has inevitably been coloured by recent events in Parliament and elsewhere, and those have placed increased emphasis on the need for public accountability from all public institutions and public servants. There is a greater awareness of the value of transparency in underpinning confidence in the use of powers under which public authorities operate. It has rapidly become essential to justify the trust placed in public organisations that use public resources of all kinds.
	A real public interest is at stake, too. Some people, in Parliament and elsewhere, perceive genuine value in demonstrating that public powers are used as they are intended. The Government, and other public authorities with which they work, can gain stature and public support only if they show themselves willing to account for their stewardship honestly and responsibly. We are all now even more conscious of the need for probity in the use of public funds. Trustworthy public audit is the best way to make people confident, all-round, that the right standards are being achieved and maintained.
	The NAO's role is unique in providing that assurance, and that is why it is important that the Comptroller and Auditor General be able to audit central Government bodies. The CAG's sphere of influence has grown over the years, and it has recently been extended to a number of central Government companies. When new central Government bodies are set up, the Government now expect the CAG to become their external auditor. If the CAG does not, there must be a good reason why.
	I am pleased to say that the Treasury has been at the forefront of such moves, ensuring, for example, that United Kingdom Financial Investments Ltd, the company that was set up to manage the Government's shareholding in banks, is audited by the Comptroller and Auditor General.

Colin Breed: It depends on whether the life of the existing hulls can be extended, which is a possibility. If there is an undertaking to obtain new hulls, then yes, the time line is quite tight, but many of us believe that the existing ones are perfectly satisfactory for at least another four years, which would offer that period of time for further reflection.

Sarah McCarthy-Fry: As the policy of the hon. Gentleman's party is not to have Trident at all, I am sure that he is not particularly bothered whether that would leave us with a bit of a gap in procurement.
	I was interested in the hon. Gentleman's comments about his bargain rail fares, available on his senior railcard; I look forward to the time when I may get one and take advantage of similar bargains.
	As regards Northern Rock, the hon. Gentleman spoke about success fees. We share his concern that costs should be tightly controlled. In fact, in this case the success fee was at the discretion of Her Majesty's Treasury, and none was paid. I want particularly to pick up his point about the mutual sector and the possibility of returning Northern Rock to it, because I want to make it clear that no doors have been closed. Obviously, as a Co-operative MP I am particularly interested in the mutual sector. In our White Paper, "Reforming financial markets", we examined the need for diversity of provision to balance risk across the financial services sector, and how the mutual sector could help to provide that. I am aware of a research paper from Oxford that offers a suggestion on how that could be done. Officials at the Treasury are looking into that, and I would welcome it if the PAC and the Treasury Committee did so too.
	We then heard from my hon. Friend the Member for Great Grimsby. For a short time, I overlapped with him on the PAC, so I am well aware of his forensic investigations when he questions witnesses. Today he returned to one of his favourite themes—consultants. When used correctly, consultants can provide great benefits, but we certainly recognise that we can do more to improve value for money. As he knows, we have introduced the consultancy value programme to implement the NAO and PAC recommendations. Our approach is that a business case needs to be made to ensure that consultancy adds value and that consultants are not used in circumstances where civil servants could meet the need, but there will be occasions when the use of expert consultants is the most efficient option. I took his general point about policy decisions needing to be taken in good faith; I picked up on that at the start of my remarks. They also need to be implemented effectively, and that requires effective planning and risk management right from the start.
	I thank the hon. Member for South Norfolk for his kind remarks, and I well remember our visit to Boston and Washington. He talked about defence expenditure. Before I entered Parliament, I spent my time on the other side, trying to win MOD contracts, managing MOD contracts, and accounting to the MOD for the cost of those contracts, so I have a little insight into that. Changes in requirements and specifications cause the biggest headaches, certainly for the supplier, and probably for the MOD as well. Moreover, our armed services obviously want the latest and best equipment, and that causes pressure and tension. Again, it comes back to the need for effective planning at the start and effective project management. The newly formed defence acquisition reform project is currently working on the matter and addressing the recommendations of the Gray report.
	We all acknowledge that the NHS IT project is hugely ambitious and that it is essential that we get it right. It is obvious to everybody that many challenges remain. We still believe that Cerner Millennium and Lorenzo will be able to support the NHS in the long term. Local service providers have been set a deadline of the end of November to demonstrate significant progress in the acute sector. They will have to demonstrate that Lorenzo has been successfully deployed by Computer Sciences Corporation across a non-acute site and is on track to be deployed in an acute site by March 2010, and that there is a high degree of confidence in CSC's ability to deploy across the NME—north, midlands and east—area by January 2016. BT will have to have successfully deployed Cerner in an additional acute site, and there must be a high degree of confidence in its ability to deploy across London by October 2015. As set out in the Treasury minute, the Department of Health will provide a note on progress by the end of this year. I shall examine the  Hansard record of the detailed points that the hon. Member for South Norfolk made and write to him with a detailed response.
	Finally, we had the contribution of the Opposition spokesman, the hon. Member for Hammersmith and Fulham (Mr. Hands), who shares my respect for the hon. Member for Gainsborough as Chairman of a very important Committee and for the work of the PAC. I had the pleasure of serving on the Committee and believe that it is the most important Committee in the parliamentary system.
	The hon. Member for Hammersmith and Fulham touched on many defence projects, including the defence information infrastructure programme, which I have not mentioned so far. It has now been delivered to all the Ministry of Defence's major headquarters, and roll-out rates for the past 18 months have been significantly higher than those of early 2008. Although there were originally delays, I hope that we are making progress.
	The hon. Gentleman moved on to the Office of Government Commerce, which regularly assesses Departments' procurement functions. It is working closely with the NAO to finalise new guidance on contract management in complex procurement, which should be published before the end of the year. It is also working to embed the joint NAO and OGC good practice contract management framework and share best practice across Departments.
	The hon. Gentleman mentioned the CDC and the Department for International Development, and he touched briefly on the paper about working in insecure environments. It is not an option for DFID not to work in such environments—the question is how we manage that work. Pay levels reflect market-beating performance and are closely linked to delivery of the Department's objectives. Independent evidence from the World Bank suggests that financial performance is a good proxy for the likely impact of CDC investment in reducing poverty.
	The Constitutional Reform and Governance Bill received its Second Reading two days ago. Some Members have taken a close interest in such measures as those on judicial appointments and the standards of the civil service. Those are important, and I would not suggest in any way that they do not matter, but to my mind the provisions to modernise the governance arrangements of the Comptroller and Auditor General and the NAO also have considerable importance. They implement the recommendations of the Public Accounts Commission in its 15th report.
	As the House knows, the commission wanted to ensure that the CAG had authority to form completely independent judgments about the audits and value-for-money studies conducted by the NAO, while maintaining systems of governance and internal controls consistent with best practice. I believe that the Bill will achieve those aims and set the NAO on a confident course towards even better performance. The new NAO board, which I wish well, should help to guide its staff to stronger and more incisive insights into the use of public funds, and we can all look to benefit from that. I am grateful for the helpful way in which the NAO has assisted the Treasury in getting the provisions right.
	I welcome the appointment of Mr. Amyas Morse, who took up his post as Comptroller and Auditor General on 1 June. He is the first CAG with extensive private sector experience, and I know that he has already set about his task with diligence and integrity and is working closely with the new NAO board under the chairmanship of Sir Andrew Likierman.
	I express my gratitude for the hard work of the Committee and the NAO, which provide able support. Everyone will agree that together they make a lasting contribution to the performance and delivery of public services across the UK. They keep the Government and public servants on their toes, and their work will continue to be as effective as it has always been.
	If this is indeed to be the last PAC debate before the general election, it will be the last time that the hon. Member for Gainsborough moves the motion, because he is to relinquish his chairmanship having served through two Parliaments. I believe that he chaired his first PAC hearing on 22 October 2001.
	I pay tribute to an important innovation that the hon. Gentleman made as Chairman: Committee reports that look across Whitehall. In particular, the Committee's 17th report, from December 2005, in which I was involved, "Achieving Value for Money in the Delivery of Public Services", was a tour de force that looked through some 400 Committee reports going back 10 years. The conclusion was that there were seven key aspects of public service delivery that Departments needed to improve to achieve value for money:
	"Plan carefully prior to implementation...Strengthen project management...Reduce complexity and bureaucracy...Improve public service productivity...Be more commercially astute...Tackle fraud"
	and
	"Better and more timely implementation of policies and programmes".
	We can see from today's debate that those things are as important today as they have ever been, and I encourage all public servants to read the report and take heed of the advice.
	Finally, I wish the hon. Gentleman well. He is a most assiduous Chairman of the PAC and during his tenure has enhanced its fearsome reputation as a robust and challenging scrutineer of public finances. I am proud to have been a member of the Committee under his chairmanship and I am delighted to have been able to respond to this debate.

Edward Leigh: With the leave of the House, perhaps I could say a few words of thanks to the Minister for her kind personal words and for her tribute to the Committee, on which she served. I also thank those who have taken part in the debate. There have not been a huge quantity of Members present, but we have made up in quality what we lacked in quantity. All their comments were interesting. I shall not repeat them—they have been summed up very well—but I shall offer some personal reflections.
	I do not want to go back over the CDC in any great detail. We know that it has made itself more efficient, but I say to the hon. Member for South-East Cornwall (Mr. Breed) that some of the salaries in some parts of the public sector—close to £1 million—are frankly obscene and not called for. My personal view, for what it is worth, is that nobody in the public sector should earn more than the Prime Minister. People in the public sector receive many other compensations and I do not think that we need such enormous salaries.
	The hon. Gentleman mentioned Northern Rock. Our report was interesting—I am not going to get into the politics of whether it was right to nationalise—and I hope that if ever such a situation arises again, officials will look at it, because many lessons can be learned about timely action.
	I thank the hon. Member for Great Grimsby (Mr. Mitchell), who kept our debate going with great verve. We are grateful for his forensic examination in our Committee. Again, I will not go through all his comments, but he mentioned the Rural Payments Agency—we are to have another hearing on that agency on Monday. The key point is that the English system was just far too complex compared with the Scottish, Welsh, Northern Irish and continental systems. That goes back to what the Minister said in her concluding remarks on our generic report about making Whitehall more efficient, reducing complexity and planning carefully. We really have to cut through the complexity if we are ever to deal with what is going wrong in the RPA.
	As usual, my hon. Friend the Member for South Norfolk (Mr. Bacon) gave us a masterclass on the NHS computer system. He is the House's expert on it. Again, if we are to make any progress on the system, we must cut through many of the knots that are binding hospitals to a failed concept and allow them to break free; otherwise, we may go on sinking good money after bad.
	I am grateful to my hon. Friend the Member for Hammersmith and Fulham (Mr. Hands) for what he said. He mentioned the major projects report. The truth is that the MOD is trying to do too much. Without getting into the wider politics of it, we will probably have to cut the number of Trident submarines. These programmes are constantly being shifted sideways and some very difficult decisions will have to be made after the general election.
	Lastly, I thank the Minister for what she said. She made a very important announcement today when she said that we would extend full audit by the Comptroller and Auditor General to the FSA. She also hinted that the Treasury has a much more open mind about the BBC and the Bank of England. We have scored an important victory today—one down, two more to go—and we will carry on working. I am grateful to all those who have taken part in the debate. In the past six months there has been so much publicity about what Members of Parliament have cost the taxpayer, but some Committees and some Members provide a good deal for the taxpayer. Saving £4 billion over eight years is not to be sniffed at. I am proud of what we have achieved and I wish the Committee and my successor every success for the future.
	 Question put and agreed to.
	 Resolved,
	 That this House takes note of the 1st to the 6th, the 8th to the 11th, the 13th to the 23rd and the 31st Reports of the Committee of Public Accounts of Session 2008-09, and of the Treasury Minutes on these Reports (Cm 7568, 7622 and 7636).

Motion made, and Question proposed, That this House do now adjourn. —(Mark Tami.)

Ann Widdecombe: I am delighted to have the opportunity to raise this important issue in the House tonight. I think that the Adjournment debate on Thursday is your selection, Mr. Speaker—if not, please do not disabuse me—and I am delighted that you have understood the importance of this issue.
	I shall make some rather critical remarks about the UK Border Agency in the course of this debate, so I should first say that I fully recognise the scale of the task that confronts it. I also recognise that it does its best to discharge that task and I have always found its staff perfectly courteous and as helpful as they can be within the rules that they operate. When one meets the immigration officers at airports, they are much more friendly than those po-faced mortals who seize manicure scissors from little old ladies on the rather improbable basis that they might be about to assist Osama bin-Laden.
	I do not want to suggest that I think for one moment that the agency is in any way useless or in some way hostile to proper judgments, but it does take completely the wrong approach. Anybody can see that, if they look at the sort of cases that the agency pursues with supreme strictness. In order to meet the multiplicity of targets that the Government have set, it aims at the softest targets, when it should be aiming at those who have eluded it for years, who have abused the system, who are in the country unlawfully, who do not comply with the conditions placed on their stay, or who do not observe their reporting restrictions. They are the people on whom the agency should concentrate. They are, of course, the hardest cases. They are not generally sitting around with their addresses on display. The agency does not pursue them. Instead it spends a disproportionate amount of its time pursuing people who have done the reverse—who have complied with conditions, kept their addresses notified to the agency and have circumstances that other people would recognise as reasonable.
	I have three particular cases in my constituency that have come up not over the course of the last year, or the last six months, or even the last couple of months. They have all come up within the last three or four weeks—two of them in a single day at my constituency surgery. That suggests a pretty concentrated effort to up the performance measurements by going for soft targets.
	When I served on the Select Committee on Home Affairs, one thing that we expressed considerable concern about was the sudden removal of settled persons—persons who had been at an address for a substantial period, had married or had other commitments in this country, were working, or in some cases had even obtained property, and whose whereabouts were beyond all reasonable doubt. The Committee felt that where people had become citizens of substance, so to speak, they should at least be given proper notice before being seized and deported.
	If the Border Agency deports somebody, that is a tick in a box, but there is a difference between deporting somebody who has been steadily eluding detection, and deporting somebody who has an appeal outstanding, who has been observing reporting restrictions or who has explained why he is still in the country. Suddenly removing that person will come as a considerable shock not only to them, but to their family.
	One of the cases I shall raise tonight is just such a case. It concerns a deportation order served on somebody who had faithfully observed his reporting restrictions. He arrived to report and was immediately arrested, put in a detention centre and deported soon after. I do not object to such action being taken against somebody who is, so to speak, underground or in deliberate defiance of an order, but I do object when it is done to somebody who is obeying orders.
	The second case concerns a woman who has been married to a British citizen for five years, has two British children and has been told that it is the opinion of the Secretary of State that not only she, but her husband and two British children, can continue their lives outside the United Kingdom.
	In the third case, we have an employment issue and a civil penalty. I strongly support, and always have done, both in government and opposition, the contention that the immigration authorities must be very vigilant about employers who take on people who are not entitled to work in this country. However, I again submit that they should be vigilant about employers doing that either deliberately or because they have been careless, and unjustifiably so, and not where an employer has taken reasonable steps to ensure that the person he is engaging is entitled to work. If that person gets indefinite leave to remain, the Border Agency sometimes says, "Ah, there was a gap between the two when the person was no longer entitled to work, so we will inflict the maximum penalty, and we will not reduce it, even a little, in recognition of the fact that the employer acted wholly in good faith." Given the economic position, £5,000 of civil penalty is quite an imposition on a small employer, so it should never be imposed unless the employer is genuinely and seriously culpable.
	I turn now to the detail of the cases. As I have already informed the Minister's office, the person involved in the employment case does not wish to be named. I must therefore refer to him as Mr. K. He runs a small business in my constituency and employed a Mr. J. Mr. J had permission to work here and Mr. K checked the documents upon engaging him. Since that time, Mr. J has paid tax and national insurance throughout, and he has recently been granted indefinite leave to remain. He says that he has a letter that both he and Mr. K, his employer, interpreted as meaning that he could continue with his current status—that is, he was entitled to work—until 2011.
	I should give a little background to the case. When Mr. K took on Mr. J, he photocopied the documents. The Minister will know that it is a Home Office requirement that it is not enough just to look at documents and say, "Yeah, yeah, I saw that this man was entitled to work." Rather, the documents have to be photocopied. That is what Mr. K, being a law-abiding citizen, did. His solicitors explained the position to the Border Agency in a letter dated 26 March 2009, in which they enclosed all the documents that Mr. K had seen and copied before agreeing to employ Mr. J.
	One of those documents was a letter dated 26 April 2002, which gave Mr. J exceptional leave to enter the United Kingdom until 26 April 2003. The letter stated:
	"provided an applicant has permission to be in the UK when an application"
	for employment
	"is made, he or she is legally entitled to remain here on the same conditions previously granted until the application is decided".
	Mr. K, who had photocopied a driving licence, a national insurance record and that letter, understood the letter to mean that Mr. J could remain in the UK and continue to work after 26 April 2003.
	However, Mr. K did not leave the matter there. An employer with less of a conscience and less concern to protect his position would simply have signed off at that point, but from time to time Mr. K asked Mr. J how the application was going. He was assured that solicitors were dealing with it and that nothing had changed. He understood that to mean that Mr. J could continue to remain and work. However, it was as a result of making such an inquiry that Mr. J subsequently produced a further letter to Mr. K.
	Mr. K believed that, having secured copies of the letters, as well as Mr. J's national insurance number card and provisional driving licence, he was acting wholly within the law. Mr. K then found out that although he can now employ Mr. J, because he has indefinite leave to remain, and was perfectly entitled to employ him when he took him on, there was a period in between in which Mr. J should not have been employed. Mr. K did not realise that.
	I am perfectly happy for there to be a penalty in that case, but I am not happy that it should be £5,000, with no remission whatever for Mr. K's efforts to try to comply with the law. If we are to be bound wholly by the rulebook, with no exercise of discretion and no application of judgment by individual officials of the Border Agency, particularly at the senior level, frankly we might as well do away with human beings altogether. We might as well tap everything into the computer and come out with a mathematical computation of the penalty at the end. In fact, civil servants, whether employed directly in government or out in the agencies, are there to exercise judgment and discretion within the rules that they operate.
	I now come to the second case, which inspired me to ask for this debate. The Minister will be aware from our correspondence how very angry I am about this one. It concerns a constituent who is happy to be named; she is Mrs. Carpenter. My constituent, Mr. R. Carpenter, married an Indonesian national five years ago in her own country. Three years ago, they also married here, because he was particularly keen that the marriage should be recognised in both countries. It is worth pointing out that he did that precisely because he wanted there to be no doubt that this was a subsisting, genuine marriage. He did not want to rely on something that had happened on foreign shores; he made quite certain that he was married according to British law as well. Since that time, the Carpenters have had two children. One is now four, the other is 13-weeks-old. Both those children are British. There is also a 12-year-old Indonesian stepchild.
	In recent years, Mr. Carpenter has been working in Singapore and China, but, until July 2003, he was domiciled and working in this country, as he is now. He resides in my constituency. As far as I know, there is no law on earth that states that a British citizen who has chosen to work abroad for a few years of his life is obliged to continue to do so if his circumstances change. Any such citizen is fully entitled to return to live and work in this country.
	The sequence of events was that, in January this year, the Carpenter family had a major family celebration, which, naturally, they wanted Mr. and Mrs. Carpenter to attend. Obviously, Mr. Carpenter could come and go at will, but, because they had been ex-pats and Mrs. Carpenter had not yet settled here, she required a visitor's visa. She got the visa; there was no problem with that. Before they left Singapore to visit Britain, however, Mr. Carpenter lost his job. They would not, therefore, have the life that they had been enjoying to return to. He has now found a job in this country, and I stress again that we are talking here about a British citizen with British children and a lawful marriage of five years' standing.
	The Carpenters then applied for Mrs. Carpenter to be allowed to stay in this country. Let me say right away that the reaction of the Border Agency should have been to say, "No. If you are applying to stay here on the basis of marriage, you must leave and apply from outside the country." I have no queries about that approach at all. That is what the agency does, and, had it done so in this case, I would have explained to Mr. Carpenter that, although it might seem harsh, that is what happens.
	Indeed, I have on many occasions had to persuade constituents who were applying to stay here as spouses—sometimes with very long marriages behind them—that they would nevertheless have to leave the country in order to make the application. I once spent three years trying to persuade a lady to go back to the Cameroons. She eventually did so, and got permission to come back here to stay within a few weeks. I understand the rule that someone applying to settle permanently in this country as a spouse must leave the country in order to do so. I have operated that rule myself.
	That is not what the Border Agency said to Mrs. Carpenter, however. Its letter stated:
	"You have provided no evidence of strong ties in terms of private life and the Secretary of State is satisfied that it is reasonable to expect all four of you to continue your family life and private lives outside of the United Kingdom."
	That is not only inhumane but outrageous. The agency says
	"you have provided no evidence of strong ties",
	yet she is married to a British citizen. She has been married to him for five years. She is the mother of two British children who can stay in this country, yet, according to the agency, she has no evidence of strong ties in terms of private life. And the Secretary of State believes it reasonable that "all four of you"—British citizens as well—should continue their family and private lives outside the United Kingdom. Why should they? Are we saying, "Once an ex-pat, always an ex-pat"? The man has a job in this country. I say again that if the Border Agency had merely said, "You would have a good case for staying here as a spouse, but you will have to go outside the country to establish it", I would see no problem with that. The Border Agency did not say that, however.
	I am aware that Mrs. Carpenter applied to stay here on compassionate grounds, as she was about to give birth. Having given birth, the Border Agency naturally enough said that there were no more compassionate grounds. I understand that, but I will absolutely not accept—and I believe it to be highly challengeable under any human rights legislation, which the Minister knows I do not usually invoke—that any British citizen can be told that "all four of you" can
	"continue your... private lives outside of the United Kingdom."
	That is provocative, cruel and not even particularly lawful.
	I turn to deal with the third case, the one I raised first in my introduction. It concerns Mohammad Ahmed, who arrived in the UK as a minor more than nine years ago. He claimed asylum, which was refused, and the appeal was dismissed. I view that as perfectly reasonable; I do not argue with it at all. Through various appeals, he has nevertheless managed to stay in the country and he has now been married to a British citizen for two years, living with her for five years before that. He also has a very stable relationship.
	As I mentioned in respect of the earlier case, it was understood that if he were to stay here now—not on grounds of asylum, but as a spouse—he would have to leave the country in order to do so. Unfortunately, the country he had to go to was Iraq, but they both accepted that that was the right way forward. They spent a great deal of time, which I am sure the Minister will find perfectly credible, trying to get a passport from the Iraqi embassy. One can understand the situation: this man has been in the country for nine years, having first entered as a minor, and the necessary documentation was not readily available, so he had to try to get recognised as an Iraqi national in order to get his passport. Investigations had to be made, which therefore took some time.
	The Border Agency recognised that these people were at last doing the right thing, so they simply imposed reporting restrictions. At first, it said Mr. Ahmed had to report weekly. As he was working, that was severely disruptive. After I made representations to the Border Agency, it was agreed that he could report monthly and as far as I know, he has faithfully reported monthly ever since. We should remember that he is trying to get a passport out of Iraq. Then, just a couple of weeks ago, he went to report and was immediately seized and taken to Colnbrook. His wife was eventually informed where he was and she began to visit him. Phoning up one morning, she was told that he was being deported that afternoon. He has since gone.
	I have no doubt that, once again, that is a tick in a box. A deportation has happened; a target has been reached: this is wonderful, and doubtless the Minister will report to the House that more deportations are taking place than ever before. Anyone who looks at those circumstances can see that that was an unreasonable deportation. The man was settled; he was married; he was working. The Border Agency knew where he was, where he lived and where he worked. What it should have done is to have served him with a notice, explaining that he would have to leave the country by such and such a date. Arresting him without any prior warning— when, as I say, the Border Agency knew where he was, where he worked and what was going on—was, in my view, heavy handed.
	The fact that I encountered three cases like that in as many weeks suggests to me that the Border Agency is having a drive, and that what it is driving at is not the difficult targets—the ones that the public really resent—but the easy ones: the people who have done their best to obey the law but find, like my Mr. K, that they are on completely the wrong side of it, despite being thoroughly convinced that they have done everything that was expected of them.
	I should be grateful to hear the Minister's comments on those specific cases. I should also be grateful to hear his comments on what I now consider to be a campaign against soft targets.

Greg Hands: rose—

Greg Hands: Thank you, Mr. Speaker. I apologise for the confusion. I was under the impression that as we can finish at any time before 6 pm, other Members were allowed to take part in the debate. I do, however, apologise—especially to my right hon. Friend the Member for Maidstone and The Weald (Miss Widdecombe)—for not giving notice that I intended to speak. I shall not speak for very long—

Mr. Speaker: Order. Let me say to the hon. Gentleman—and for the benefit of others attending our proceedings—that in so far as there was any slight confusion, that is the explanation of it. It is commonplace in these circumstances for the approval of the Member who has secured the debate, and that of the Minister as well as that of the Chair, to be sought. There is time available, and I am certainly not insisting on it, but that is the reason for the confusion.
	The hon. Gentleman may now have the Floor.

Greg Hands: Thank you for that guidance, Mr. Speaker.
	I shall not speak for very long. As I have said, I did not intend to speak at all, but I happen to have become very interested in the actions and activities of the UK Border Agency over a considerable period.
	A couple of years ago, the Home Office produced a league table—which was remarkable, given that it is generally not very good at producing proper statistics about anything, particularly immigration—listing the Members of Parliament who had received the most immigration inquiries. I was ranked No. 1 among Conservative MPs, which did not surprise me a great deal, as at any one time there are between 700 and 800 immigration cases on my book.
	Speaking as a constituency Member, I share all the concerns raised by my right hon. Friend the Member for Maidstone and The Weald. I do not have details of many specific cases with me, so I shall refer to only two.
	About 18 months ago I visited the UKBA's offices at Lunar house in Croydon, which were, I believe, in their current configuration. I think that the staff were a bit surprised to find that a Member of Parliament wanted to go to see them. I too was surprised, and disturbed, by what I found. First, I found a young and dedicated team of staff who impressed me a great deal. I thought that they were probably quite poorly managed, and they were certainly struggling under the work load. Their work had been computerised, and they could take me to their computers and show me the latest computerised file on one of my constituents. At the same time, however, they were unable to do anything without resorting to the voluminous physical file that was retained in another room. The other room, at the back of Lunar house—it was like a conference room—was packed with physical files, which were enormous and held together with string and rubber bands. The superficial impressiveness of the computer system was unfortunately rather undone by that.
	My right hon. Friend spoke of pursuing those who had complied. I have come across such cases on a number of occasions during the four and a half years in which I have been a Member of Parliament. Let me cite one which, although it dates from a while ago, illustrates the phenomenon well.
	The events that I am about to describe took place in the summer of 2006, six months before Bulgaria and Romania became full members of the European Union. Although I concede that there are restrictions on citizens of those countries in terms of where they can work and the requirement for them to have work permits, their entitlement to be here was not in doubt after 1 January 2007.
	My constituent worked at the European Bank for Reconstruction and Development, a development bank dedicated to improving the lives of those in central and eastern Europe, and indeed out in the former Soviet Union. She was the case officer for Bulgaria. It is probably a good idea for such a person to be a Bulgarian national, as there are unlikely to be enough United Kingdom subjects with a sufficient level of competence or expertise. It seems entirely reasonable that she was in this country working for the EBRD. She had clearly complied, almost precisely to the letter, with everything she had been asked to do. However, she was asked to produce within two weeks an astonishing 30 or 32 documents including fairly obvious things such as her birth certificate and payslips, but also her school reports from Bulgaria. It was entirely unrealistic to expect the production of such documentation from someone who, it seems to me, was perfectly justified in being in this country.
	I contrast that with other cases where clearly the person should not be in this country. I have raised a particular case at Prime Minister's questions. I was astonished to receive a pro forma letter on an immigration case, addressed to me as an MP. The letter stated that, unfortunately, the agency had been unable to determine the case because the person concerned was a member of or was aligned with the beliefs of the al- Qaeda organisation. That was in an immigration letter sent to me as the constituency Member of Parliament.
	The letter went on to apologise not only to me but to the person concerned and his family for any distress and inconvenience caused by taking so long to consider his case. The case is complicated, but this did not seem to me to be someone to whom we should be apologising. I contrast that with the treatment of some of our constituents whom I think have been treated badly.

Keith Vaz: I apologise for missing the start of the debate, which started a bit sooner than I expected. Has the hon. Gentleman seen the letter that Lynne Homer sent to me yesterday in which she said that the UK Border Agency has now discovered 40,000 files it did not think it had seen before? That is 40,000 people whom the agency does not know are still in the country or not. Is that not indicative of the shambles that currently grips the UK Border Agency at Lunar house?

Andrew MacKinlay: The Minister said that the agency does not go for soft targets, but I have to tell him that that is not my experience. Single young men are like the Scarlet Pimpernel in that they move around and are difficult to find, but the agency picks up seven, eight or nine loving families in bed at six o'clock on a Sunday morning. That is what is happening, but not in my name, because it stinks. People experience the trauma of having their doors being banged on at six o'clock in the morning, when everyone knows where they are. What is going on is wholly unacceptable in this day and age. It is happening because politicians on both sides have played the numbers game, and—

Alan Campbell: I shall consider the subject of removals in a moment, but I was making the point that there is no policy of going for soft touches, and if the assumption—or accusation—is that the agency is not pursuing the hard cases in every way that it can, I can assure the hon. Gentleman and others that that is not so.

Alan Campbell: Staff are properly trained to work within the rules. Of course there will be some leeway and discrepancy in individual cases, but it is important to ensure that those rules are applied impartially. I am trying to explain that that is necessary not only in the first instance of contact with individuals, but throughout the handling of a case. It is, however, also important to have in place appeal mechanisms, and beyond, to ensure that cases are dealt with reasonably and within the rules.
	As for the issue of those who are allowed to work in the UK, it is very important that we have an immigration system that is fit for the 21st century and protects the interests of not only Britain and British people, but foreign nationals who have legally settled here. That is why we introduced and are rolling out the flexible points system, which has the purpose of controlling the number of people coming to the UK from outside Europe and ensuring that they have the skills that this country requires. We cannot allow individuals to circumvent this system once they are already here.
	The right hon. Member for Maidstone and The Weald is concerned about the implementation of the new civil penalties regime. We know that the way to tackle illegal immigration is to tackle illegal working. The availability of illegal work is often associated with breaches of legislation governing tax, health and safety, and so on, and it can act as an incentive for people to enter and remain in the country unlawfully. The experience of UKBA staff shows that illegal migrant workers tend to be found in jobs and occupations that are often considered unattractive by UK workers because of the hours, wages and working conditions that prevail. As a result, those migrant workers are exploited should they take those jobs on coming into this country.
	That is why we introduced new measures on 29 February 2008 under the Immigration, Asylum and Nationality Act 2006 that distinguish between employers with less than adequate recruitment practices and the more serious cases where employers knowingly and deliberately employ illegal migrant workers. The measures include: a system of civil penalties for less diligent employers—I take the right hon. Lady's point about her view of the diligence in the case that she raised; a tough new offence of knowingly employing an illegal migrant worker, which applies to the more serious cases and can carry a penalty of up to two years' imprisonment and/or an unlimited fine; and a continuing responsibility on the employers of migrant workers to check their ongoing entitlement to work in the UK. Again, I note the points that right hon. Lady made about that responsibility.
	UKBA takes an intelligence-led approach to operations and will target those whom it believes may not be complying with their obligations. Again, let me be clear that there are no soft targets. UKBA will issue civil penalty notices to any employers should it come across evidence of illegal working. Where evidence exists to show that an individual has been knowingly employing illegal migrant workers, consideration will be given to prosecution, as appropriate. The evidence in respect of the notices that have been issued and the potential value in fines shows that we were right to bring in this tough legislation.
	Let us consider the second case that the right hon. Lady raised and the general points arising from it. On her concerns about UKBA's application of the immigration rules to individual cases, I should say that the rules lay down the requirements that need to be satisfied by a person who seeks leave to remain as the spouse of a person present and settled in the United Kingdom. The first requirement is that the applicant has limited leave to enter or remain that was given in accordance with any of the provisions of the immigration rules. The only exception to that would be where, as a result of that leave, he or she would not have been in the UK beyond six months from the date on which he or she was admitted to the UK—on this occasion in accordance with the rules. The requirement prevents people admitted to the UK for six months as a visitor from switching into the category of spouse. I understand the particulars of the case that the right hon. Lady has described, but I am trying to set out the background for the rules.
	We strongly believe that anyone who is coming to this country with the intention of settling on the basis of marriage should apply for spouse entry clearance in the proper fashion, from abroad—the right hon. Lady accepted that point. Before the no-switching requirement was introduced in April 2003, more than half of those who switched into the marriage category did so within six months of entry to the UK. I hope that I can set out why the rule is as it is. Many of those who switched intended to avoid rigorous examination of marriage applications by diplomatic posts abroad or the higher costs of obtaining spouse entry clearance compared with visitor entry clearance.
	Some applications to UKBA for leave to enter or remain touch on article 8 of the European convention on human rights. Article 8, which is a qualified right, states that everyone has the right to respect for his or her private and family life. Restriction or interference with that right is permissible in order to maintain effective immigration control. When an application for leave to enter or remain contains an express or implied family life claim, caseworkers should complete a five-stage process, considering the following questions: does the claimant have family life in the UK; is it reasonable to expect the family to leave with the claimant; if there is interference with family life, is it in accordance with the law and the immigration rules, published policy and procedures; is the interference in pursuit of one of the permissible aims set out under article 8(2); and is the interference proportionate to the permissible aim?
	In considering proportionality—item 5—caseworkers consider all relevant factors and no one factor is decisive. The prospective length and degree of family interruption involved is highly relevant, as is the person's immigration history. Any delay in considering the claim is relevant. Another factor is whether family members can or cannot reasonably be expected to join the person abroad when he or she makes his or her entry clearance application.

Ann Widdecombe: I am grateful to the Minister for giving way. I have a feeling that he was about to embark on the point I want to raise, but in the case that I was quoting—that of the Carpenters—it is not just that Mrs. Carpenter was expected to leave but that the Secretary of State expected all four of them to continue their lives outside the United Kingdom. That is outrageous.

Alan Campbell: Yes, I understand the right hon. Lady's point. I am sure that that will be considered, as the case is still live, as I understand it. I do not want to comment specifically on it, but I am sure that that point will be made strongly when the case is considered by those whose job it is to consider such matters.
	It is also open to a person to apply for leave to remain outside the immigration rules. The only two circumstances in which it will be necessary to consider granting leave to remain outside the rules will be in cases where someone qualifies under one of the published immigration policy concessions or for reasons that are particularly compelling in the circumstance. Such leave to remain outside the rules will inevitably be rare, and should be given only for genuinely compassionate reasons—I am sure that that will form part of the deliberations on the case—or where it is deemed absolutely necessary to allow someone to enter or remain in the UK when there is no other option available.
	I cannot accept the accusation that we are targeting soft cases. I do not accept that, but I understand the concerns and frustrations of right hon. and hon. Members, particularly when it comes to constituency cases. It is important that we have strong rules and that they are applied fairly and consistently. It is also important that they can be challenged and that there are avenues of appeal. I understand that such appeals are still under way in some of the cases that we have discussed.
	Let me say something briefly about removals and proper notice. Of course, one wishes and hopes that systems are humane and fair and, where possible, take into account all the characteristics of a case. If there is the threat that someone will be removed, it is not the case that they become aware of that threat only at the moment at which they are removed. Throughout the process, the implication and assertion is that there is a risk that they will be removed if they do not have a right to be here. The suddenness of that removal can of course cause concern, but to some extent it reflects the actions of the lowest common denominator in such cases. I am not commenting on the case mentioned by the right hon. Lady, but if a person is warned of the time of their removal, where it will take place and who will do it, in many cases they will choose to abscond. The long trail to find them will then be embarked on again and they will have to be tracked down at considerable expense. I understand the concern that has been expressed, but the difficulty of making judgments in these cases, and of carrying them out, needs to be appreciated.
	I understand the frustration felt by the right hon. Lady and others across the House, especially in constituency cases. I want to reassure her, as far as I can, that cases are looked at properly and within the rules, and that there is no targeting of soft cases. All cases will be dealt with properly, and that includes the appeals process.
	As I said at the outset, my hon. Friend the Minister for Borders and Immigration will write to the right hon. Lady on the specifics of the case. If she is not fully satisfied with this afternoon's debate, I hope that he will be able to address her concerns further.

Andrew MacKinlay: I rise on a parliamentary point. The Minister is a Member of Parliament, as am I. When we write to an agency, it is not unreasonable that our letter be given special attention—not because of who we are, but by virtue of our office. When Members of Parliament write on behalf of constituents, I ask that the matter is advanced, not as a privilege but because those Members have deemed it sufficiently important. It is not good enough for us to get a letter saying that our inquiry is in a queue—a practice that endures almost exclusively in UKBA. I hope that the Minister will reflect on that.